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Changes to the Home Working Allowance

What You Need To Know

In response to the challenges posed by the COVID-19 pandemic, the Government introduced special provisions allowing those working from home to receive a tax-free allowance of £6 per week.

This initiative provided significant relief to employees, enabling them to offset the additional costs associated with remote work. These relaxed regulations were in effect for the tax years 2020/21 and 2021/22.

However, it’s important to note that as of 6th April 2022, the rules regarding this allowance have reverted to their original statutory position. This change means that employees are no longer automatically entitled to the £6 weekly allowance, and they must meet specific criteria to claim tax relief for home working expenses.

Employees are eligible to claim tax relief if they are required to work from home due to a formal home-working agreement. There are various scenarios in which this may apply, such as if:

  • Distance from the Office: An employee’s job necessitates living far away from the office, making remote work a practical solution.
  • Lack of Office Space: Some employers do not maintain physical offices, requiring their employees to work remotely as a standard practice.
  • Office Closure or Scheduled Home Workdays: If the office is closed on specific days (for instance, every Friday) and employees are mandated to work from home on those days, they can claim tax relief.

It’s essential to emphasise that tax relief cannot be claimed if an employee chooses to work from home voluntarily. This distinction is crucial, as it clarifies that the relief is intended for situations where remote work is a requirement based on the nature of the job or the employer’s policies.

As these regulations have reverted to their original form, both employers and employees should be aware of the changes to ensure compliance with the current tax guidelines.

If you have any questions about your eligibility or the application process for home working tax relief, please contact our friendly and experienced tax team on 01384 376 964.

Folkes Worton LLP Chartered Accountants
Accounting for the Future

Meet the Tax Team

Matthew Morris FCCA CTA
Tax Partner
Dan Simpson ACA
Chartered Accountant
Ellie Smith ATT
Tax
Jack Taylor
Accountant