Working from Home Tax Relief UK: Who Can Claim & How to Apply

Remote working is now a core part of modern employment, but did you know you may be able to claim HMRC tax relief for working from home? If your employer requires you to work from home and you’re covering extra household costs, you could be entitled to financial support.

Raising children is one of life’s greatest joys – but it’s also undeniably expensive. From nursery fees to after-school clubs, childcare costs can quickly overwhelm even the most organised family budget. If you’re feeling the strain, you’re not alone – and there is government support available.

In this guide, our Manchester accountants explain:

• Who qualifies for tax relief on home working expenses

• Flat-rate vs actual cost claims

• Worked examples for employees

• Rules for self-employed individuals and limited company directors

• How to backdate your claim and avoid HMRC pitfalls

• Additional Tips for Claiming Working from Home Tax Relief
  

Can I Claim Tax Relief for Working from Home?

You may be eligible for tax relief if:

• Your employer requires you to work from home (not just permits it)

• You incur additional household expenses

• You’re not already reimbursed by your employer or company

This applies to:

• Employees

• Freelancers and sole traders

• Company directors working from home

Worked Examples: How Much Can You Claim?

Example 1: Basic Rate Taxpayer (20%)

Sarah, a full-time employee, works from home without any reimbursement. She claims HMRC’s flat-rate of £6 per week (£312 annually).

• Relief: £312 × 20% = £62.40 saved per year

Example 2: Higher Rate Taxpayer (40%)

James is a senior employee required to work remotely. He claims the same flat rate.

• Relief: £312 × 40% = £124.80 tax relief

If your homeworking costs are higher and you keep receipts, you can claim the actual cost instead.

Who Qualifies for Home Working Tax Relief?

You can claim if:

• Your employer has no office space available

• You are instructed to work from home (e.g. Fridays)

• You incur extra costs (e.g. electricity, broadband)

You cannot claim if:

• You choose to work from home (e.g. hybrid by preference)

• Your office is open but full

• You already receive a homeworking allowance

COVID-19 Exception: HMRC temporarily relaxed rules for 2020/21 and 2021/22, but they returned to normal from April 2022.

Self-Employed? You Can Claim Business Use of Home

If you’re a sole trader or freelancer, claim a share of your home costs through:

Option 1: Simplified Expenses (Flat Rate)

• 25–50 hours/month: £10/month

• 51–100 hours/month: £18/month

• 101+ hours/month: £26/month

Option 2: Actual Costs

Option 2: Actual Costs
Proportionally claim for:

• Heating, lighting, broadband

• Phone use

• Mortgage interest or rent

• Council tax and home insurance

Keep records and apply a reasonable business-use percentage

Directors Working from Home: What Can You Claim?

If you’re a limited company director, you have two main options:

Option 1: Flat-Rate Reimbursement

Your company can pay you £6/week tax-free — no receipts needed.

Option 2: Claim Actual Costs from the Company

You can claim higher amounts if:

• You keep detailed records

• Costs are “wholly and exclusively” for business use

• Your home has a dedicated workspace

Rent and mortgage cannot usually be reimbursed unless there’s a formal rental agreement between you and your company.

How to Claim Working from Home Tax Relief

Employees:

1. Go to HMRC’s claim page
2. Choose between flat rate or actual cost
3. Submit online via your personal tax account or Self Assessment

Self-Employed:

• Use the business expenses section in your Self Assessment tax return

Company Directors:

• Reimburse yourself via your company (if using the flat rate)

• Keep documentation and board minutes for actual cost claims

Can You Backdate a Working from Home Claim?

Yes – you can backdate your claim for up to 4 tax years, if you were eligible during those years.

What About Travel Expenses?

You cannot claim tax relief for commuting between home and your usual office.

However, if:

• Your home is your main place of work

• You travel to temporary sites (e.g. client meetings)

…then those travel expenses may be allowable.

Company directors: include board minutes or employment agreements showing homeworking is essential for business purposes.

Still Unsure What You Can Claim?

We know HMRC’s tax rules can be confusing — especially for hybrid workers, contractors, or directors. At Accounting Solutions Manchester, we’re here to make tax simple

✅ Let us check your eligibility

✅ Help you calculate what’s fair

✅ Ensure your claim is fully compliant

Summary: Working from Home Tax Relief UK

Category	Can Claim?	Method
Employee	✅ If required to work remotely	Flat rate or actual costs
Self-Employed	✅	Simplified or actual costs
Director	✅	Reimbursement from company

Additional Tips for Claiming Working from Home Tax Relief

Keep Accurate Records

Whether you’re claiming a flat rate or actual costs, it’s essential to maintain good records. For actual expenses, store receipts, utility bills, and a log of your working hours. HMRC may request evidence to support your claim, especially for directors and self-employed individuals using the “actual cost” method.

Consider the Impact on Capital Gains Tax

If you claim a portion of your home as an exclusive business space, you could risk losing part of your Private Residence Relief if you later sell your home. This usually affects only those who have a clearly defined home office used solely for business, so consider this before claiming business-only use of a room.

Speak to a Tax Adviser

Every situation is different — especially if you’re a hybrid worker, contractor, or running a business from home. Seeking personalised advice can help you avoid common mistakes and maximise what you’re legally entitled to. An experienced accountant can also advise on how working from home may affect your tax code, expenses, or financial planning.