Compliance
Homeworking Relief Removed: What Employees Should Know
From 6 April 2026, UK employees can **no longer claim tax deductions for extra household costs** if their employer doesn’t reimburse them—here’s how to adapt and what alternatives exist.
By NomadicTax Research Team • 5-8 min read • April 24, 2026
## What has changed?
From 6 April 2026 (start of the 2026-27 tax year), legislation enacted via the Finance Act 2025 removes the ability for employees to claim Income Tax deductions for additional household expenses incurred due to working from home when those costs are **not reimbursed by their 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))
Costs previously claimable included increased utility bills, business telephone calls, etc., either based on receipts or via the flat rate allowance of £6 per week. ([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))
## Who is affected, and who isn’t
| Category | Impact |
|---|---|
| Employees who have been reimbursed by employers under qualifying policies | **Not affected**—reimbursed expenses remain exempt from Income Tax and NICs. ([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)) |
| Employees who choose to work from home under contract but have no employer reimbursement | **Affected**—cannot claim deductions from Income Tax from 6 April 2026. |
| Employees working at the employer’s location, or whose homeworking isn't part of contractual requirement | Generally **unaffected** by this change. |
## Alternatives & employer responses
- Employers can implement work from home reimbursements to cover these additional costs—such reimbursements, if structured properly, are exempt from PAYE and NICs. ([gov.uk](https://www.gov.uk/government/publications/employer-bulletin-april-2026/april-2026-issue-of-the-employer-bulletin?utm_source=openai))
- Employees should check whether their employer offers such reimbursement or start conversations if not.
## Examples to illustrate
1. **Sam**, a graphic designer required by her contract to work from home. Previously she claimed £6/week for utility costs via tax relief. Under the new law, she must get employer reimbursement to receive tax-free benefit.
2. **Aisha**, who works from home occasionally by preference, with no contractual obligation. She was not claiming under relief previously under this category—thus change doesn’t materially impact her.
## Takeaways & action items
- If you’re an employer, review internal policies to offer refrimbursements for homeworking costs to your staff—this offers both fairness and tax efficiency.
- Employees should gather recent invoices, understand what expenses their employer covers, and keep up-to-date with contracts specifying homeworking requirements.
- Tax advisers should update client guidance to reflect the lost deduction route and focus on structuring reimbursements.
## What’s still possible
- The old flat rate claim method (or actual costs with receipts) remains possible for the **previous four tax years**, if not yet claimed. ([gov.uk](https://www.gov.uk/tax-relief-for-employees/working-at-home?utm_source=openai))
- Employers can still benefit from offering reimbursements or directly purchasing work equipment or arranging eye tests/flu vaccines with tax and NIC exemptions. See “expanding workplace benefits relief” article. ([gov.uk](https://www.gov.uk/government/publications/employer-bulletin-april-2026/april-2026-issue-of-the-employer-bulletin?utm_source=openai))
**Bottom line:** From April 6, 2026, tax relief for unreimbursed homeworking household costs is gone. If you rely on this, you’ll need employer participation or shift to employer-provided benefits to maintain tax efficiency.