HMRC warns home workers 'don't get caught out'

People who work from home are being urged to double-check their eligibility before claiming tax relief, as mistakes could lead to hefty repayments being owed. HM Revenue and Customs (HMRC) has highlighted a surge in questionable claims, after home working skyrocketed due to the pandemic, and slip-ups that might make workers dip into their own pockets.

HMRC said in a post on X: "Don't get caught out by ads promising quick tax refunds for working from home. Always check if you're eligible before making a claim. Avoid agent fees by claiming directly with HMRC."

This comes as a change means many could be ineligible for relief intended to offset specific occupational costs like higher heating bills or business calls. It is not meant to cover day-to-day expenses such as rent or internet charges.‌

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Tax expert Andy Wood from Tax Natives points out: "Tax relief for working from home is available in specific circumstances, such as when an employer requires an employee to work remotely, or if there is no office available." He highlighted that voluntary home office arrangements don't qualify for obtaining the financial relief.

Employees have the option to go for a flat rate of £6 per week or to account for additional outgoings they directly incur as a result of their work. He said: "Claims must relate directly to work-related costs, such as business calls or a proportion of heating and electricity, not to general household costs like rent or broadband."

The tax relief rules were given a revamp during the lockdown, to the benefit of home office warriors, but now there's a catch. Mr Wood further explained that eligibility may no longer be the same.

He continued: "Many people who were eligible during the pandemic may no longer qualify today, so it's important not to assume continued entitlement without checking." The alert is also directed at tax refund businesses touting easy money – potentially resulting in unsuspecting clients being saddled with unexpected debts if HMRC challenges the claims.

Mr Wood added: "Taxpayers should be aware that even if they use an agent or tax refund company to submit a claim, they remain personally responsible for the accuracy of the information provided," warning that any mistakes will come out of the pockets of the individuals themselves, not the agents.

HMRC encourages individuals to validate their eligibility with its online checker before making any submissions. For those who are eligible, claims can be made for the current fiscal year - and up to the four preceding years if they haven't done so already.