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Remote working can be a double-edged sword. While it has allowed many businesses to continue operating during lockdown and brought an end to commuting, we’ve had to battle with video conferencing technology, limited childcare and isolation. And while we have saved money on fuel, travelcards and takeaway coffee, remote working can bring a whole host of additional costs.
From rising gas and electricity bills to business phone calls, your household outgoings may well have risen as a result of working at home all day. You may also have had to upgrade your internet connection and spend more on stationery and other equipment too.
With offices expected to remain predominantly closed as the colder weather draws in, those working at home could see their utility bills hike up by almost a fifth (18%) of their usual amount. This means the average household energy bill could climb by £107 ($139) this winter for those working from home five days a week, according to the research by Energy Helpline.
In total, homeworking over the winter could see the nation’s energy bills rise up to as much as £1.9bn between October 2020 and March 2021 due to the increased use of heating and lighting.
“With many offices expected to be partially or completely closed over autumn and winter, millions face a worrying hike in bills from working at home at the time of year when we use most energy,” said Tom Lyon, director of energy at Energy Helpline.
“In addition, consumers paying by Direct Debit should normally now be in credit ahead of winter, but are finding themselves already in debt from spending more time at home since March.”
So how can you keep costs down if you are working from home?
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Claim tax relief
You may be able to claim tax relief for additional household costs if you have to work at home on a regular basis, either for all or part of the week. However, you can’t claim tax relief if you choose to work from home.
Additional costs include things like heating, metered water bills, home contents insurance, business calls or a new broadband connection. They do not include costs that would stay the same whether you were working at home or in an office, such as rent or council tax. You may also be able to claim tax relief on equipment you’ve bought, such as a laptop, office chair or desk.
There are two ways to claim tax relief. You can claim up to £6 a week from 6 April 2020, which has risen from £4 for previous tax years. You won’t need to keep evidence of your extra costs. However, you don’t save £6 a week because you only save the tax you would have paid on it. That works out as £1.20 a week for a basic rate taxpayer.
You can also claim the exact amount of extra costs above the weekly amount, but you will need to show receipts, bills and other pieces of evidence.
If you’re self-employed, you can claim allowable expenses for some business costs. You may be able to claim a proportion of your costs for things like heating, electricity, Council Tax, mortgage interest or rent, internet and telephone use, stationery or phone bills and travel costs like fuel, among others.
HMRC has set up a new tax helpline to support businesses and self-employed people who are worried about being able to pay tax they owe because of COVID-19.
It may seem like an additional hassle to switch energy suppliers, but it could save you a significant amount of money. If you’re worried about rising costs, switch to the cheapest tariff and contact your supplier about ways they can help.
New licensing rules set to begin from 15 December will require suppliers to offer emergency credit to customers struggling to top up their prepayment meters. This action will mostly be needed for the customers who are considered vulnerable.
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There are various grants and benefits offered by the government and suppliers, such as the Winter Fuel Payment or the Cold Weather Payment. However, you may need to already be on certain benefits such as income support or universal credit to be eligible.
Make household changes
Changing your light bulbs to LEDs can be expensive in the short-term, but they use up to 90% less energy than traditional bulbs and can save you money over the winter. It is also pricey to heat an entire apartment or house when you’re only really working in one room — and you’re more likely to feel it if you’re sat at a computer all day. It may be worthwhile investing in a portable heater, blankets or other items to keep the cold out.
If working from home means you’re no longer using a monthly or annual season ticket for your commute, public transport companies may let you cancel it and refund you the remaining portion of your ticket.
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