HOMEWORKING TAX RELIEF: WHAT CHANGED AND WHAT EMPLOYEES NEED TO KNOW

ASESA Solutions Ltd - HOMEWORKING TAX RELIEF: WHAT CHANGED AND WHAT EMPLOYEES NEED TO KNOW

Many employees became familiar with claiming tax relief for working from home during the pandemic. However, the rules have changed significantly, and many taxpayers are unaware that they may no longer qualify.

What Has Changed?

HMRC no longer allows employees to claim tax relief simply because they choose to work from home. The relief is now only available where an employee is required to work from home and their employer does not reimburse the additional household costs incurred.

In most cases, employees who have hybrid working arrangements by choice will not qualify for tax relief.

Who May Still Be Eligible?

Tax relief may still be available if:

• There is no office available for the employee to work from.

• The nature of the job requires the employee to work remotely.

• The employee incurs additional household costs as a direct result of working from home.

• The employer does not reimburse those costs.

What Should Employers Do?

Employers should ensure employees understand the current rules and avoid making assumptions based on previous pandemic-era guidance.

Review any homeworking policies and communicate clearly whether employees are working remotely by choice or business necessity.

Key Takeaway

The temporary pandemic concessions have ended. Employees should check their eligibility carefully before making a claim, as incorrect claims could result in HMRC enquiries and repayment requests.