HMRC has announced that the tax relief currently available to employees who are required to work from home will be withdrawn from 6 April 2026. At present, employees can claim a flat-rate deduction of £6 per week (or the actual additional costs if they can provide evidence). From 2026, this relief will no longer be available, unless the employer reimburses the expenses directly.
Currently, employees who are required to work from home and incur extra costs, such as increased utility bills, can currently claim tax relief.
During the pandemic, the Government temporarily relaxed the rules for 2020/21 and 2021/22, allowing anyone working from home because of Covid-19 restrictions to claim the relief. Since then, hybrid and remote working has become more common.
Recent Government checks discovered that over half of claims were made by employees who weren’t eligible. This was because PAYE tax code adjustments were incorrectly carried forward from the pandemic years; or hybrid workers assuming that choosing to work from home qualified them for relief, when the rules only apply where homeworking is a contractual requirement.
From 6 April next year, employees will no longer be able to claim tax relief on homeworking expenses, unless their employer reimburses the costs.
Employers will still be able to reimburse genuine homeworking costs tax-free, so it may be worth reviewing your company’s homeworking policies ahead of the change.
Do get in touch with our team at Lewis & Co, if you’ve got any question: 01892 513515.