With more people in the UK working from home, the costs associated with remote working can start to add up and there are some real savings if you can claim these back as expenses. We speak to some industry experts to find out the rules surrounding this
The Covid pandemic accelerated the new wave of hybrid working and working from home, with now as many as four out of 10 UK employees working at home for at least one day per week.
This new work lifestyle means turning your spare bedroom, kitchen table or study into your new makeshift office. Rather than working in an office where all expenses are covered by your employer, you might have several relevant expenses to carry out your job, from furniture, broadband, telephone and more.
Many workers and homeowners may not be aware that some of these costs can be claimed as expenses, and you can use this to reduce your tax liability. We spoke to some industry experts to get their advice on how to claim expenses if you work from home.
“For people now working from home, you must meet a certain criteria if you want to claim some expenses,” outlines Gavin Cooper of claims expert, Claims Bible. “In particular, you need to have a dedicated workspace in your home which is exclusive for work-related activities.”
Cooper says this could be as simple as a home office – be it a spare room or study – but for some would most likely be a dedicated area within the home. This would be the case for hairdressers, beauticians, furniture makers, tutors and even GPs who work remotely.
“The expenses you claim must be solely for work and not luxuries, so anyone trying to shave money on their new kitchen is unlikely to be successful. But rent or mortgage interest, property taxes, ongoing maintenance associated with your office are common ones,” Cooper confirms.
Whether you are employed or self-employed could have an impact on how you claim for expenses when working from home, says Justine Gray, co-founder of tech platform, Trending Impact.
“As an employee of an organisation, things like home desktops or laptops might be included as part of your employment and therefore you cannot legally claim back on these,” Gray says.
“In other cases, you may be able to get reimbursements directly from your company who may be making a saving that you are not based in a centralised office.”
She notes people who are self-employed are responsible for all their outgoings and costs; their home is likely to be their main location for work.
“Since being self-employed, you are completing your own tax returns, it would be far more natural and practical to claim back on any work expenses you incur,” she says.
Harry Adair of utilities firm, Warmable, says there are “a number of things” around the home that people working remotely can claim for if “legitimately used for work purposes.”
“You have basic utilities such as gas, electricity, heating, water and internet and these may be significant if they are key to your home-run business,” he says.
Adair also notes things like mortgage interest, rent and council tax, along with any home repairs or accessories that are key for your work, would also fall into the catchment. This includes desks, office chairs, screen and monitors, computers, light bulbs, painting and even decorating.
“You need to start considering your home as an asset and part of this asset is used for work purposes,” explains Richard Allan of legal expert, Divorce Bob.
“Starting by looking at which parts of the house that you use to conduct your work, you might look at this in terms of square feet and what percentage of the house is therefore used for work.
He notes that once you have determined what percentage of your house is used for work purposes – be it a bedroom with a desk, a garden office, or kitchen table – a calculation of what share of the costs can be expensed can be made.
“You will need to calculate the cost of rent or mortgage, utilities, internet, phone bills and any other expenses against the number of days you work and the space you use for work in the house,” he says.
Always consult with your account and the HMRC for recent guidelines
