- Working from home tax relief is usually only available to employees who are required to work from home and incur extra household costs.
- You can claim either a flat rate amount or claim actual additional costs, but you must be able to justify any actual cost claims with records.
- Claims can often be backdated, and the way you apply depends on whether you use PAYE or Self Assessment.
Working from home tax relief allows some UK workers to reduce their tax bill if they are required to work from home and incur extra household costs as a result. If you want to make sure you are claiming correctly and not missing relief you are entitled to, support from a UK tax accountant can help you stay compliant and avoid mistakes.
If you are an employee, self-employed, or a limited company director, the rules differ on what you can claim and how you apply. In this guide, you will learn who qualifies for working from home tax relief, what expenses you can claim, how much you can claim, and how to submit your claim to HMRC correctly.
What is working from home tax relief?
Working from home tax relief is a form of income tax relief that allows eligible workers to claim back tax on extra household costs caused by working from home. It is designed to cover additional expenses, not ordinary household bills you would pay anyway.
HMRC only allows claims where working from home is required by your job and results in higher costs. Choosing to work from home for convenience does not usually qualify.
Who can claim working from home tax relief?
Eligibility depends on your employment status and the reason you work from home. HMRC applies different rules to employees, self employed individuals, and company directors.
Understanding which category you fall into is essential before you start a claim. For more information, we have a guide on helping you differentiate between employed and self employed here.
Employees
Employees can usually claim tax relief if they are required to work from home and their employer does not reimburse the extra costs. This applies even if you only work from home part of the time.
Most employees pay tax through the PAYE tax system, which means working from home tax relief is usually applied by adjusting your tax code rather than paying you directly.
You cannot normally claim if working from home is optional or written into your contract as a flexible benefit.
Self employed individuals
If you are self employed, working from home expenses are claimed through your annual Self Assessment tax return, reducing the profit you pay tax on
If you are unsure how this fits into your wider return, our guide to self assessment expenses explains how claims work in practice.
Limited company directors
Limited company directors may be able to claim working from home expenses either personally or through the company. The correct approach depends on how the costs are incurred and reimbursed. Directors should be especially careful when claiming working from home costs, as HMRC applies stricter rules to limited company expenses than to sole traders.
Our overview of ltd company expenses explains how directors can claim expenses without creating tax issues.
If you are an employee with relatively low additional household costs, the £6 per week flat rate is often the safest option. It does not require receipts, reduces the risk of HMRC queries, and still provides tax savings without complex calculations.
Claiming actual costs can increase your relief, but only if you can clearly show that the expenses were additional, reasonable, and directly linked to your work. If you are unsure, starting with the flat rate can help you avoid mistakes while still benefiting from tax relief.
What working from home expenses can you claim?
Only additional costs caused by working from home are allowable. You cannot claim expenses that would exist regardless of your work.
Common allowable expenses include:
- Extra heating and electricity used during working hours
- Metered water costs linked to work
- Business phone calls
- Cleaning costs for your work area
Expenses such as rent, mortgage payments, and council tax are only claimable in limited situations, mainly for the self employed.
How much tax relief can you claim when working from home?
There are two ways to calculate your claim. You can use the flat rate method or claim actual additional costs.
The method you choose affects how much evidence you need to keep.
Flat rate method
Employees can claim a flat rate of £6 per week without providing receipts. This equals £312 per year if you qualify for the full tax year.
The actual cash benefit depends on your tax band. A basic rate taxpayer saves £1.20 per week, while a higher rate taxpayer saves £2.40 per week. You can see how tax bands affect savings in our guide to UK tax brackets.
Actual cost method
You can also claim the exact additional costs you incur. This requires evidence such as bills and a clear calculation showing how the costs relate to your work.
This method can result in higher relief, but it carries more risk if HMRC challenges your figures.
How do you calculate working from home expenses?
Calculations are based on how much of your home is used for work and how often it is used. HMRC expects a reasonable and consistent approach.
For example, if you use one room out of five as a home office for half the day, you can usually claim a proportion of relevant bills. Self employed individuals often use this method alongside other claims explained in our sole trader expenses guide.
How do you claim tax relief for working from home?
The way you claim depends on how you normally pay tax.
Employees who do not complete a Self Assessment can usually claim directly through HMRC’s online service. HMRC explains the process on its official page for tax relief on working from home expenses.
If you already file a tax return, the claim is made as part of your return. Our guide to how to file a self assessment tax return walks through where expenses should be included.
Can you backdate a working from home tax relief claim?
Yes, in many cases you can backdate a claim for up to four tax years. This can result in a refund if you were eligible but did not claim at the time.
Backdating rules are strict, so it is important to ensure you met the eligibility criteria in each tax year you claim for.
Is working from home tax relief changing?
The rules around working from home tax relief have tightened since 2023. Many people who claimed during the pandemic are no longer eligible.
HMRC has also confirmed that the employee working from home tax relief will be withdrawn from April 2026. The latest updates are published on GOV.UK and should be checked before making future claims.
What happens if HMRC challenges your claim?
If HMRC questions your claim, they may ask for evidence or an explanation of how you calculated the costs. Claims that cannot be justified may be reduced or rejected.
Keeping clear records and using a consistent method reduces the risk of penalties or adjustments.
What are the risks of claiming working from home tax relief incorrectly?
Claiming working from home tax relief is usually straightforward, but errors can create problems if HMRC reviews your claim. This risk is higher when claiming actual costs rather than the flat rate allowance.
If a claim is incorrect or unsupported, HMRC may take one or more of the following actions:
- Request evidence, such as utility bills, phone records, or calculations showing how costs were apportioned
- Reduce or reject the claim if the figures cannot be justified
- Ask for repayment of any tax saved through an incorrect claim
- Charge interest on underpaid tax
- Apply penalties, particularly where HMRC believes the mistake was careless or deliberate, which can result in HMRC penalties and fines
Self employed individuals and limited company directors are generally at higher risk because they are responsible for calculating and reporting their own expenses.
To reduce the risk of issues, it is important to:
- Keep clear and accurate records
- Use a reasonable and consistent calculation method
- Only claim expenses that meet HMRC’s eligibility rules
If your circumstances are complex, professional advice can help ensure your claim is accurate and defensible.
How Sleek helps you claim working from home tax relief correctly
Claiming working from home tax relief seems simple, but mistakes can be costly. The rules vary by employment type, the calculations must be reasonable, and the evidence must stand up to HMRC scrutiny.
Sleek helps you assess eligibility, calculate claims correctly, and submit them in line with HMRC rules. With expert support, you can claim what you are entitled to while avoiding unnecessary risk.
Fill in the contact form and we will get back to you soonest.
Disclaimer: The preceding information is not legal advice. This content is aimed to provide general guidance. For more formal or legal advice, contact Sleek directly.
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FAQs on working from home tax relief
Is tax relief automatic or do I need to apply?
Tax relief is not automatic in most cases. You usually need to apply through HMRC, either via an online claim or as part of your Self Assessment tax return. If you do not submit a claim, HMRC will not adjust your tax code or issue a refund, even if you are eligible.
What are common misconceptions about tax relief?
A common misconception is that anyone who works from home can claim tax relief. In reality, HMRC normally requires that you are required to work from home and incur extra costs. Another misunderstanding is thinking tax relief is a cash payment, when it actually reduces the tax you pay.
Can individuals and businesses both claim tax relief?
Yes, but the rules differ. Employees usually claim income tax relief on extra costs, while self employed individuals and limited companies claim allowable expenses to reduce taxable profit. How you claim depends on your employment status and how the costs are incurred.
How can you check if you qualify for tax relief?
You can check eligibility by reviewing HMRC’s criteria or using its online eligibility checker. You should confirm whether working from home is a requirement of your role and whether you have genuinely incurred extra costs as a result. When in doubt, professional advice can help avoid incorrect claims.
Is it better to claim tax relief online or through an accountant?
Claiming online is quicker and suitable for straightforward cases, such as the flat rate allowance. Using an accountant is often better if your situation is more complex, involves actual cost calculations, or includes self employed or limited company income. An accountant can also reduce the risk of HMRC challenges.
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What happens if you claim the wrong tax relief?
If you claim tax relief incorrectly, HMRC may reduce or reject the claim and ask for repayment of any tax saved. In some cases, penalties or interest may apply. Keeping records and understanding the rules before claiming helps minimise this risk.
How much money can you save with tax relief?
The amount you save depends on the type of relief and your tax band. For working from home tax relief, the flat rate saves between £1.20 and £2.40 per week for most employees. Claims based on actual costs or wider expense relief can result in higher savings.
