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300,000 workers affected by scrapping of work-from-home tax relief
Newsletter issue – January 2026
Workers can currently claim either a flat £6 weekly allowance or actual additional costs, with claims backdated up to four tax years. From April 2026, employees will no longer be able to claim the £6 per week tax relief for home-working expenses. HMRC says the change is to address non-compliance - over half of claims checked were found to be ineligible. It is aiming to ensure fairness across the tax system.
HMRC estimates that around 300,000 employees will be affected by this change, resulting in basic rate taxpayers paying about £62 more per year, and higher rate taxpayers about £124 more.
However, employers can still reimburse home-working costs tax-free (no income tax or National Insurance deductions). So, businesses may need to decide whether to cover costs directly or risk losing staff who can't afford remote work.
What our clients say about us...
"Paul has provided accountancy services to my company for 2 years now. I can recommend Paul very highly; his skills as an accountant are highly detailed and professional and he is always available to provide advice. One aspect of the way Paul works that I greatly appreciate is a preference to meet face to face when there is a detailed conversation to be had. I personally find this more productive and is a benefit of working with a small accountancy firm that you wouldn't get with the large faceless providers."
ALISTAIR FAIRWEATHER - PROGRAMME & PROJECT MANAGER, DELIVERING/RESCUING I.T. 7 BUSINESS CHANGE WITH BUDGETS UPTO £50M INC SUPPIER MANAGEMENT
"I couldn't ask for more from Paul as an Accountant. Paul has been accountant to Work Relief Charity Recruitment for just over a year now and is proving an invaluable asset. Accurate, knowledgeable, flexible with an emphasis on service delivery, I would recommend Paul's services to any organisation looking for an accounts professional."
Neil Price - Managing Director at Work Relief Charity Recruitment
"Paul was a referral from a family member when I started my business 2 years ago. As this was the first time I had ever run my own company I was totally clueless over the financial side of matters and was worried that I may have made mistakes in any of my accounting. I needn't have worried as after enaging Paul for a set monthly fee he was always there on the end of the phone for all sorts of questions I had and no matter how trivial they were Paul gave me all the information I required and more and did an excellent and painless job at the end of my first year! Couldn't ask for any better to be honest. Just two words - hire him!!!"
Lee Westrap MBCS - Director - Bulldog IT Services
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