If you work from home, you may be entitled to tax relief on your additional household costs. Whether you're employed or self-employed, this guide explains exactly what you can claim, how to claim it, and how much you could save on your tax bill.
Table of Contents
1. Who Can Claim?
Working from home tax relief is available to people who work from home and incur additional costs as a result. However, the rules differ depending on your employment status and circumstances.
Employees
You can claim tax relief if:
- Your employer requires you to work from home
- There is no suitable workplace available
- Your job requires you to live far from your employer's premises
- Your employer hasn't reimbursed you for the extra costs
Important: "Choose to" vs "Required to"
Since April 2022, the rules have tightened. If you simply choose to work from home for convenience, you cannot claim. You must be required to work from home by your employer or have no suitable workplace available.
Self-Employed
If you're self-employed and use your home for business, you can claim a proportion of your household costs as a business expense.
2. Tax Relief for Employees
Employees have two main options for claiming working from home tax relief.
Option 1: Flat Rate (Simplest)
HMRC allows employees to claim a flat rate of £6 per week (£26 per month) without needing receipts or proof of costs.
| Tax Rate | Annual Flat Rate | Tax Relief |
|---|---|---|
| Basic rate (20%) | £312 (52 × £6) | £62.40 |
| Higher rate (40%) | £312 | £124.80 |
| Additional rate (45%) | £312 | £140.40 |
Option 2: Actual Costs (Higher but More Complex)
If your actual additional costs exceed £6/week, you can claim the exact amount—but you need evidence.
Costs you can claim include:
- Additional heating
- Additional electricity
- Metered water costs
- Business phone calls
You'd need to calculate the proportion used for work and keep records.
Which Option is Better?
For most employees, the flat rate is simpler and sufficient. Unless your additional costs are significantly higher than £6/week and you're happy to keep detailed records, the flat rate is usually recommended.
3. Tax Relief for Self-Employed
Self-employed people have more flexibility in claiming home office expenses.
Option 1: Simplified Expenses (Flat Rate)
HMRC offers a flat rate based on hours worked at home:
| Hours Worked From Home Per Month | Flat Rate Per Month |
|---|---|
| 25-50 hours | £10 |
| 51-100 hours | £18 |
| 101+ hours | £26 |
Annual maximum: £312 (if working 101+ hours every month)
Option 2: Actual Costs (Proportionate)
Calculate the proportion of household costs attributable to business use. You can base this on:
- Room proportion: If your home has 4 rooms and 1 is a dedicated office = 25%
- Time proportion: Adjust for hours actually used for business
- Area proportion: Based on floor space of office vs total
Claimable Expenses for Self-Employed
- Proportion of rent or mortgage interest
- Proportion of council tax
- Proportion of utilities (gas, electric, water)
- Proportion of home insurance
- Repairs and maintenance to office area
- Business phone line and broadband
Capital Gains Tax Warning
If you claim a proportion of mortgage interest or rent, HMRC may consider that part of your home has been used exclusively for business. This could affect Principal Private Residence relief if you sell your home. Most advisers recommend claiming based on non-exclusive use to avoid this.
4. What Can You Claim?
Understanding what qualifies as a claimable expense helps you maximise your tax relief.
Household Running Costs (Employees & Self-Employed)
- Heating: Additional heating costs while working
- Electricity: Lighting, computer use, charging devices
- Water: If on a meter, additional use
- Business calls: Work-related phone calls
Additional Costs (Self-Employed Only)
- Rent proportion: Based on business use
- Mortgage interest: Proportion for business use
- Council tax: Proportion for business use
- Home insurance: Additional business cover
- Broadband: Proportion or full cost if solely for business
What You Cannot Claim
- Food and drink
- Mortgage capital repayments
- Costs you would have incurred anyway
- Personal use of equipment
- Childcare costs
5. How to Claim
The claiming process differs depending on your situation.
Employees: Claim via HMRC
- Go to gov.uk/tax-relief-for-employees
- Sign in with Government Gateway
- Select "Working from home"
- Confirm your employer requires you to work from home
- Submit your claim
Your tax code will be adjusted to give you the relief automatically through your salary.
Employees: Via Self Assessment
If you already file a tax return, claim working from home relief in the employment section under "Other expenses and capital allowances."
Self-Employed: Self Assessment
Include your home office expenses in the expenses section of your Self Assessment tax return. Keep records of how you calculated the proportion for business use.
Claim for Previous Years
You can backdate claims up to 4 years. If you worked from home in previous tax years and didn't claim, you can still get that relief. Claims for 2020/21 must be made by 5 April 2025.
6. Calculating Your Relief
Let's look at some real examples of how much you could save.
Example 1: Employee Using Flat Rate
Sarah is required to work from home 3 days per week. She claims the £6/week flat rate.
- Annual claim: £312
- Sarah is a higher rate taxpayer (40%)
- Tax relief: £312 × 40% = £124.80 per year
Example 2: Self-Employed Using Actual Costs
Tom runs a consultancy from home. His annual household costs:
- Electricity: £1,200
- Gas: £900
- Council tax: £1,800
- Broadband: £400
- Home insurance: £300
- Total: £4,600
Tom uses 1 of 5 rooms as a dedicated office (20%) for 40 hours per week out of 168 (24%).
Calculation: £4,600 × 20% × 24% = £220.80 per year
Plus broadband primarily for work: £400 × 80% = £320
Total claimable: £540.80
Example 3: Self-Employed Using Simplified Expenses
Emma works from home 120 hours per month (30 hours/week).
- Monthly flat rate: £26
- Annual claim: £312
If Emma is a basic rate taxpayer, this saves: £312 × 20% = £62.40 in tax
Which Method Saves More?
In Tom's example above, actual costs (£540.80) beat simplified expenses (£312). If you have a dedicated workspace and high household costs, actual costs often work out better—but require more record-keeping.
7. Equipment and Furniture
Beyond running costs, you may be able to claim for work equipment.
Employees
If your employer requires you to buy equipment for work and doesn't reimburse you, you may be able to claim tax relief. Items must be:
- Necessary for your job
- Used wholly and exclusively for work
- Not reimbursed by your employer
Examples: Computer for work use, office chair, desk (if required for work)
Self-Employed: Capital Allowances
Self-employed people can claim capital allowances on equipment:
- Annual Investment Allowance: 100% of cost up to £1 million
- Small items: Can be claimed as expenses
Claimable equipment includes:
- Computer and laptop
- Monitor and peripherals
- Office furniture (desk, chair)
- Printer
- Office software
- Phone for business use
Personal Use Adjustment
If equipment is used for both personal and business purposes, you can only claim the business proportion. For example, if you use a laptop 60% for work and 40% personally, claim 60% of the cost.
8. Hybrid Working
Many people now work a hybrid pattern—some days at home, some in the office. Here's how tax relief works.
Can Hybrid Workers Claim?
Yes, if:
- Your employer requires you to work from home on those days
- There's a genuine business reason (not just employee preference)
- Your contract or employer policies reflect this
How Much Can You Claim?
For employees using the flat rate, you can claim £6/week for any week you work from home, even if just one day.
For self-employed using actual costs, adjust your calculations for the proportion of time actually spent working from home.
The "Convenience" Trap
If you work from home purely by choice—because it's more convenient or you prefer it—and your employer would provide you with a workspace, you cannot claim. The requirement must come from your employer or be due to the nature of your job.
9. Common Mistakes to Avoid
1. Claiming When Not Eligible
Don't claim if you simply choose to work from home for convenience. HMRC has tightened enforcement since the COVID rules ended.
2. Overclaiming
Claiming more than the actual business use proportion could lead to penalties if investigated.
3. Not Keeping Records
If you claim actual costs rather than flat rate, keep receipts and records of how you calculated your claim.
4. Forgetting to Claim
Many eligible people don't claim at all. If you're entitled, claim it—it's your money!
5. Double Claiming
If your employer reimburses you for home working expenses, you can't also claim tax relief on the same costs.
6. Not Reviewing Annually
If your circumstances change (working patterns, costs, etc.), review your claim each year to ensure it's still accurate and optimal.
10. Frequently Asked Questions
Can I claim if I work from home one day a week?
Yes, if that one day is required by your employer (not just your choice). You can claim for any week where you work at least one day from home.
What if my employer gives me an allowance?
If your employer pays you a working from home allowance up to £6/week (£26/month), it's tax-free. You can't claim additional relief on top. If they pay less than £6/week, you may be able to claim the difference.
Can I claim for years I forgot to claim?
Yes, you can backdate claims up to 4 years. Use form P87 or Self Assessment.
Do I need to tell my mortgage lender I work from home?
Generally not if you're just working from home as an employee. If you're running a business from home with customers visiting, you should inform your mortgage lender and insurer.
Will claiming affect my council tax?
Usually not for home workers. Business rates only apply if part of your home is used wholly or mainly for business purposes with exclusive access.
Can I claim for a home office I built or converted?
Self-employed people may be able to claim capital allowances on conversion costs. Employees generally cannot. Be cautious about CGT implications if you create an exclusively business-use space.
Conclusion
Working from home tax relief is a valuable benefit that many people miss out on. While the amounts may seem small, they add up over time—and it's money you're entitled to.
Key takeaways:
- Employees can claim £6/week without receipts if required to work from home
- Self-employed can claim a proportion of household costs or use simplified expenses
- You must be required to work from home—choosing to isn't enough
- Claims can be backdated up to 4 years
- Equipment used for work may also be claimable
- Keep records if claiming actual costs
Take action now: if you work from home and haven't claimed, check your eligibility and make your claim through gov.uk or your Self Assessment return.
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James Mitchell, ACCA
Chartered Accountant & Former HMRC Advisor
James is a Chartered Certified Accountant (ACCA) specialising in UK personal taxation and financial planning. With over 12 years in practice and a background as a former HMRC compliance officer, he brings authoritative insight to complex tax topics.