Tax bill: How to cut your tax bill when working from home


Tax is likely to rise in the wake of the coronavirus crisis to cover the Government’s support packages such as the Coronavirus Job Retention Scheme. But Express.co.uk has compiled a guide to explain how you can cut your tax bill when working from home.

Many people working from home have found they have saved money on transport, lunch and other costs.

But people have also found they are spending more on bills such as heating and electricity.

Some employers give their staff an allowance to cover these excess costs.

But for those that do not, employees can claim a small reduction in their taxes for the time they were forced to work at home.

READ MORE: Car tax changes could see current rules scrapped

For postal P87s you will need your National Insurance number.

However, when applying online there are two boxes:

The “Amount paid by you” box where the HMRC asks you to put the total amount of increased costs you have faced so you should put a total amount that’s equivalent to £6 per week for the period you have been working from home and that’s fine, you won’t need to show receipts.

The ”Amount paid to you by your employer” box is where you check the box if your employer has not paid you a designated working from home allowance or reimbursed your homeworking expenses – you should put £0 in this box.

Other ways to save on tax

You can reduce your tax by:

  • Checking your tax code
  • Claiming tax credits
  • Paying into a pension scheme
  • Benefiting from marriage allowance
  • Meeting the tax return deadline
  • Reclaiming overpaid taxes
See also  Here's how Joe Biden plans to change Social Security if he is elected president

Employees can take advantage of tax benefits in the following ways:

  • Getting a season ticket loan
  • Claiming tax-free childcare
  • Getting a company car
  • Switching to a low-emission car.

You can cut the tax on your savings by:

  • Maximising your personal savings allowance
  • Making the most of your ISA allowance
  • Using the starter rate for savings.





READ SOURCE

LEAVE A REPLY

Please enter your comment!
Please enter your name here