Tier 4: Working from home set to rise but 80% of staff are missing out on expense support

Martin Lewis quizzes HMRC chief on Self-Employment scheme

Tier four rules were recently laid out by Boris Johnson as a new strain of coronavirus emerged. This will be disheartening for millions of families who may have felt that normality was just around the corner.

For the foreseeable future, families will need to continue to work from home where they can.

The government has launched many support measures to help with this where they can and several experts, including Martin Lewis, have highlighted generous work expense benefits that can be received by HMRC.

However, new data from ExpenseOnDemand has revealed only 20 percent of employees working from home are claiming relevant expenses.

Where an employer requires their staff to work from home, it can result in increased costs and as such, HMRC can step in to ease the burden.

We will use your email address only for sending you newsletters. Please see our Privacy Notice for details of your data protection rights.

If an employee works from home, even for just part of the week, they will be eligible to claim a rate of £6 a week from HMRC and this can be backdated to the date this commenced.

This means, in effect, employers can either pay staff an extra £6 a week tax free or the employees can ask for the amount to be deducted from their taxable income.

With some form of lockdown being in place since March, this could generate substantial amounts.

Despite this, the support seems to going over many people’s heads as Sunil Nigam, the founder of ExpenseOnDemand, noted: “As the real economic impact of the pandemic takes affect many individuals are seeing reductions in pay as financial leaders manage in the short term to try and survive this difficult year.

DON’T MISS:
SEISS: Self-employed left ‘undermined’ as extended support is needed [EXPERT]
Furlough extension: Rishi Sunak condemned for ‘limited’ progress [INSIGHT]
Rishi Sunak ‘must’ fix SEISS issues – MPs claim you ‘have been failed’
 [WARNING]

“It is therefore amazing to see that only 20 percent of employees are benefitting from the tax-free saving of £312 a year.”

it should be noted claims for tax relief can only be made under specific circumstances, which include:

  • employers using their own money for things they must buy to do their job
  • employers only using specific tools and items exclusively for their work

This tax relief cannot be claimed if a worker’s employer gives them back all the money they spent.

As it stands, staff working from home may be able to claim tax relief on:

  • uniforms
  • vehicles used for work
  • professional fees and subscriptions
  • travel expenses and
  • other equipment

Yesterday, Matt Hancock laid out where the next set of tier four restrictions will be introduced which will therefore likely force many more people to work from home: “So, from one minute past midnight on Boxing Day, Sussex, Oxfordshire, Suffolk, Norfolk and Cambridgeshire, those parts of Essex not yet in Tier 4, Waverley in Surrey, and Hampshire, including Portsmouth and Southampton, but with the exception of the New Forest, will be escalated to Tier four.

“Bristol, Gloucestershire, Somerset, including the North Somerset Council area, Swindon, the Isle of Wight, New Forest and Northamptonshire, as well as Cheshire and Warrington, will be escalated to Tier three.

“And I’m afraid Cornwall and Herefordshire have seen sharply rising rates and need to be escalated to Tier two.”

The government has plans to reassess where the UK stands with coronavirus and lockdown measures on December 31.

Source: Read Full Article