A long-standing tax relief that helps home-based workers cover household expenses will be scrapped from April 2026, in a move that will affect an estimated 300,000 employees and raise tens of millions for the Treasury.
The relief — originally introduced more than a decade ago and widely used during the pandemic — allows employees who are required to work from home and receive no reimbursement from their employer to claim either their actual additional costs or a standard rate of £6 per week without providing receipts.
From 6 April 2026, this entitlement will be abolished, removing a benefit worth £62 a year for basic-rate taxpayers and £124 a year for higher-rate taxpayers. The Treasury says the decision is aimed at tackling widespread non-compliance, arguing that more than half of claims fail verification checks.
HMRC said claims surged during and after the pandemic, with many employees continuing to claim the allowance even when no longer formally required to work from home. Ministers argue the move is about restoring “fairness” to the system.
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