From 6 April 2026, employees will no longer be able to claim a tax deduction for expenses incurred while working from home.
Currently, some employees are able to claim either a flat-rate deduction of £6 per week or the actual additional costs of working from home, where these are higher. This relief will be withdrawn in full from April 2026.
Why the relief is being removed
The government has confirmed that the home-working expenses deduction is being abolished because it is frequently claimed by individuals who are not entitled to it under the existing rules.
HMRC has taken the view that the relief is no longer operating as intended.
Employer reimbursement will still be possible
Although employee tax relief will be removed, employers will still be able to reimburse home-working expenses without triggering PAYE tax or National Insurance contributions, provided strict conditions are met.
The expenses must be wholly, exclusively and necessarily incurred as a result of the employee’s duties. In practice, this generally means that the employee’s contract requires them to work from home.
Employees who choose to work from home, rather than being required to do so, will not qualify for tax-free reimbursement of home-working expenses.
Further guidance is expected closer to April 2026.