Working from home compensation: How YOU could get £125 by working from home

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

The online portal was launched by HM Revenue and Customs (HMRC) and has been set up to help employees claim back any additional expenses they’ve encountered by working from home. Another scheme was previously launched in which workers could claim £6 a week in tax free money to cover things like higher energy bills. HMRC said since the new scheme launched on October 1, more than 54,800 claims have been made.

How you could get £124 by working from home

The way it works is that employees can claim tax relief based on the rate of tax they pay.

An example from HMRC is if a worker pays a 40 percent tax rate and claims tax relief on £6 a week, they would get £2.40 a week (40 percent of £6).

Over the course of the year, this means taxpayers can cut down the amount of tax they pay by a huge £124.80.

For workers who are taxed the basic rate of 20 percent, they will be able to make savings of £62.40.

Once the application has been approved, the online portal will adjust the claimant’s tax code for the 2020/2021 tax year.

The employee will receive a tax relief directly through their salary and will continue receiving the adjustments until March 2021.

That means you won’t get a one off payment, instead it will be included as part of your weekly or monthly payments from work, and the money will be visible on your pay slip.

HMRC’s interim director general of customer services Karl Khan said: “We want everyone to get the money they are entitled to, so we’ve made the online service as easy to use as we can – it takes just a few minutes to make a claim.”

To check if you’re eligible to use the online tool, you can visit the homepage on Gov.uk. 

When applying, you will be asked:

  • If you have paid tax
  • What you’re claiming tax for
  • If you’re trying to get money back for more than £2,500 in one tax year
  • If you have completed a self-assessment tax return
  • If you’ve paid tax the year you’re claiming for
  • If your employer has already paid you expenses

DON’T MISS
Job Support Scheme calculator: How how much could you take home? [INSIGHT]
How to clean and protect your home office space from coronavirus [GUIDE]
Pension contribution rules altered – can you take advantage? [EXPLAINED]

You will be then directed to another page on which you can sign in to you Government portal, or create a login if you don’t have one.

The whole thing is free to do and is a good place to manage your tax payments if you do a self-assessment tax return.

HMRC said you can claim from the date you began working from home and you can claim work-related expenses for any of the previous four tax years.

You will also be able to claim once the tax year has ended (April 2021) and receive a lump sum of money instead of a monthly payout.

The tool is one of many HMRC schemes implemented in a bid to try and help people with any extra expenses they are incurring.

Workers have been told they can spread out their tax bills with Rishi Sunak’s Time to Pay scheme.

Those who were required to work from home from the very beginning of lockdown (March 23) and returned to the office this week can make a claim for 24 weeks.

That adds up to a refund of £28 for standard rate taxpayers, £56 for higher rate taxpayers, or £63 for additional rate taxpayers.

Source: Read Full Article