Tax Planning
From Homeworking Relief to New Relief Structure: Planning Strategies After April 2026 UK Changes
With HMRC removing deductions for non-reimbursed homeworking expenses from 6 April 2026, individuals and businesses should rethink their employment contracts and benefit structures to maintain tax-efficient arrangements.
By NomadicTax Research Team • 5-8 min read • April 9, 2026
## What Has Changed and When
From **6 April 2026**, employees in the UK will **no longer be able to claim deductions** for additional household costs incurred when required to work from home **if those costs are not reimbursed by the employer**. ([gov.uk](https://www.gov.uk/government/publications/income-tax-removal-of-the-tax-relief-for-additional-homeworking-expenses/removal-of-tax-relief-on-non-reimbursed-homeworking-expenses?utm_source=openai))
Currently, such deductions include utility costs, telephone bills, and home office expenses under section 336 ITEPA 2003. There is also a fixed-rate easement of **£6 per week** for those without receipts. ([gov.uk](https://www.gov.uk/government/publications/income-tax-removal-of-the-tax-relief-for-additional-homeworking-expenses/removal-of-tax-relief-on-non-reimbursed-homeworking-expenses?utm_source=openai))
## What This Means for Individuals
- Higher rate taxpayers who were claiming **£6/week or actual costs** may see their taxable income rise, leading to additional tax due. ([gov.uk](https://www.gov.uk/government/publications/income-tax-removal-of-the-tax-relief-for-additional-homeworking-expenses/removal-of-tax-relief-on-non-reimbursed-homeworking-expenses?utm_source=openai))
- Basic rate taxpayers will see smaller but still non-trivial increases.
- For those already in roles requiring homeworking, reviewing contracts to see if employers can reimburse expenses cleanly will become more important.
## Actionable Strategies
### 1. Negotiate Reimbursement Policies
- Employers should consider offering **expense reimbursement** for homeworking items (e.g. broadband, heating) rather than relying on employee claims.
- Reimbursements that meet HMRC eligibility **avoid Income Tax and NICs deductions**. ([gov.uk](https://www.gov.uk/government/publications/income-tax-removal-of-the-tax-relief-for-additional-homeworking-expenses/removal-of-tax-relief-on-non-reimbursed-homeworking-expenses?utm_source=openai))
### 2. Adjust Work Location Requirements
- Consider if roles labelled “homeworking required” truly necessitate working from home; employers may adapt policies to reduce obligations if cost-efficient homeworking is shifted to voluntary remote work.
### 3. Review Contracts & Job Descriptions
- Contracts may need clauses about **which homeworking costs employer will cover**, especially for roles continuing to require home-based work.
### 4. Plan Tax-Efficient Allowances and Benefits
- Homeworking equipment or furniture supplied by employer may be treated differently from those purchased and reimbursed—ensure supplies are provided or reimbursed to avoid loss of deduction.
- Consider using **benefit-in-kind structures** carefully; e.g., employer provides broadband contribution rather than cash to employee. Legal advice may help.
## Example Scenarios
- **Scenario One**: A graphic designer working from home who paid for extra utilities and internet. Under new rules, unless employer reimburses costs, they cannot claim tax relief for those expenses—costs now fully borne out of net pay.
- **Scenario Two**: Employer offers a fixed monthly sum to cover broadband and utilities; paying this sum as a reimbursement may avoid tax implications if structured correctly according to HMRC guidelines.
## Broader Impacts to Consider
- Companies may face increased **costs** if expanding reimbursement benefits.
- Employee expectations could rise; **transparent policy communication** will be critical to avoid morale issues.
**Bottom Line**: With the removal of deductions for non-reimbursed homeworking expenses from 6 April 2026, both individuals and employers should proactively redesign their arrangements to safeguard tax efficiency and manage employee costs.