Compliance
Compliance Pitfalls Under UK’s New Vaping Products Duty and Homeworking Expense Rules
From 6 April 2026 the UK introduced sweeping changes around vaping product duty registration and home-working expense deductions—affecting both businesses and remote workers in critical ways.
By NomadicTax Research Team • 5-8 min read • May 2, 2026
## The UK Changes You Need to Know
Two major tax and compliance shifts took effect in the UK from **6 April 2026**:
1. **Vaping Products Duty (VPD)** and Vaping Duty Stamps registration opens ahead of its effective start date on 1 October 2026. ([gov.uk](https://www.gov.uk/government/publications/employer-bulletin-april-2026/april-2026-issue-of-the-employer-bulletin?utm_source=openai))
2. Removal of tax relief for **non-reimbursed homeworking costs**, counter-balanced by new exemptions for employer-reimbursed costs including eye tests, homeworking equipment, and flu vaccinations. ([gov.uk](https://www.gov.uk/government/publications/employer-bulletin-april-2026/april-2026-issue-of-the-employer-bulletin?utm_source=openai))
## Vaping Products Duty & Duty Stamp Scheme
- Duty imposed on certain vaping products to discourage use and ensure compliance with new health regulations. The VPD requires **registration** starting now, even though the duty applies from 1 October 2026. ([gov.uk](https://www.gov.uk/government/publications/employer-bulletin-april-2026/april-2026-issue-of-the-employer-bulletin?utm_source=openai))
- Vaping Duty Stamps (VDS) will add further administrative and marking requirements for physical products.
### Risks & Compliance Measures
- Companies in manufacturing, import, distribution or retail need to *register as VPD entities* well before the 1 October enforcement date. Missing this deadline can lead to penalties or inability to sell regulated products legally.
- Ensure systems for labelling and stamping are ready; acquire stamp designs, stock and adapt packaging. Keep detailed records of invoices, duties paid, product codes etc.
## Homeworking Expense Rules
- The tax relief allowing employees to claim **non-reimbursed homeworking costs** (like utilities, business phone calls, increased energy) has been **removed** as of 6 April 2026. Claims may still be made for the previous four tax years for eligible expenses not yet claimed. ([gov.uk](https://www.gov.uk/government/publications/employer-bulletin-april-2026/april-2026-issue-of-the-employer-bulletin?utm_source=openai))
- On the flip side, reimbursements from employers for **eye tests**, **VDU-required corrective devices**, **homeworking equipment**, and **flu vaccinations** are now **tax and National Insurance exempt**, whether the employer pays the provider directly or reimburses the employee. ([gov.uk](https://www.gov.uk/government/publications/employer-bulletin-april-2026/april-2026-issue-of-the-employer-bulletin?utm_source=openai))
## Practical Advice for Employers & Employees
| Role | Action Needed |
|------|---------------|
| Employers | Update payroll systems by **June/July 2026** to handle new exemptions correctly. Communicate clearly to employees what qualifies and what doesn’t. Create/provider voucher-or reimbursement policies. |
| Employees/Contractors | Review prior years' unclaimed homeworking costs (up to four tax years back) before the removal kicks in. Keep all receipts and evidence concerning VDU equipment, eye tests, etc. Confirm what your employer provides directly vs what you must buy and be reimbursed for in the new system. |
## Examples
- Sarah works from home and used her own broadband and phone calls for business in 2022-23. She has not yet claimed non-reimbursed costs—those claims may still be filed now within the applicable years.
- Tom’s employer provides a laptop and covers the costs of a flu jab and eye test now—all exempt from tax and NI, whereas previously reimbursed homeworking heating bills would have been taxed.
## Key Takeaways
- This change shifts the compliance burden: fewer employee-claims for household expenses, more employer responsibility to reimburse properly and stay compliant.
- Record keeping is vital—retain receipts, invoices, proof of employment necessity, and ensure reimbursements are documented in line with HMRC guidelines.
- Mistakes can lead to unexpected tax bills or penalties, so get ahead of system changes and payroll updates.