By Eternity Accountants Editorial Team · Reviewed by Shamayun Chowdhury, Senior Accountant · Published: 7 November 2026 · Last reviewed: November 2026 · Applies to the 2026/27 tax year
The main work from home benefits in 2026/27 are tax-free employer payments of up to £6 a week, tax-free home office equipment, flat-rate expenses for the self-employed, and backdated claims. Since 6 April 2026, employees can no longer claim working from home tax relief directly from HMRC.
Working from home saves commuting time and travel costs, but many people also expected a tax break. That changed on 6 April 2026, when the government ended the working from home tax relief that employees used to claim straight from HMRC.
The good news is that several work from home benefits still exist. This guide explains what employees, sole traders and company directors can still claim in 2026/27, how much each option is worth, and how to backdate a claim before the four-year window closes.
- Employees cannot claim working from home tax relief from HMRC for 2026/27 onwards.
- Employers can still pay up to £6 a week (£26 a month) tax-free to staff with homeworking arrangements.
- Eligible employees can still backdate claims for earlier years, but the 2022/23 claim must reach HMRC by 5 April 2027.
- Sole traders can use flat rates of £10, £18 or £26 a month, or claim a share of actual costs.
- Company directors can be paid the same £6 a week tax-free, or charge their company a fair rent.
- What are the work from home benefits in 2026?
- What changed in April 2026
- Work from home benefits for employees
- Backdating claims for earlier years
- Work from home benefits for the self-employed
- Work from home benefits for company directors
- Worked examples for 2026/27
- Council tax, broadband and selling your home
- Frequently asked questions
- Final verdict
What Are the Work From Home Benefits in 2026?
Work from home benefits fall into two groups. The first is the everyday saving: no daily commute, lower travel and lunch costs, and more flexible hours. The second is tax: money you can receive or deduct without paying Income Tax or National Insurance on it.
| Who you are | Main tax benefit in 2026/27 | How much |
|---|---|---|
| Employee | Tax-free homeworking payment from your employer | Up to £6 a week, or more with evidence |
| Employee | Tax-free equipment for home working | Laptop, desk, chair and similar items |
| Employee who had to work from home before April 2026 | Backdated tax relief claim | £6 a week, for up to four earlier years |
| Sole trader or partner | Flat-rate or actual home costs | £10 to £26 a month, or a share of bills |
| Company director | Homeworking payment or rent from your company | £6 a week, or a fair rent agreed in writing |
Commuting and lifestyle savings
For many people, the biggest work from home benefits are not tax-related at all. Skipping even two commuting days a week can save hundreds of pounds a year on fares or fuel. Those savings come out of income you have already been taxed on, so every pound saved goes further.
What Changed in April 2026
According to GOV.UK’s guidance on tax relief for working from home, employees cannot claim tax relief for working from home for the 2026/27 tax year onwards. The change was announced in the Autumn Budget on 26 November 2025.
Before then, employees who had to work from home could claim £6 a week, worth £62.40 a year to a basic-rate taxpayer and £124.80 to a higher-rate taxpayer. HMRC had found that many claims did not meet the rules, because people who chose to work from home were not eligible.
Check your tax code
If you claimed the old work from home tax relief online, HMRC usually added it to your tax code. Check your 2026/27 tax code in the HMRC app. If the £6 a week adjustment is still showing, tell HMRC so you do not build up an underpayment.
Work From Home Benefits for Employees
The end of the HMRC claim does not mean employees are left with nothing. The key work from home benefits now come through your employer.
Tax-free homeworking payments
HMRC’s Employment Income Manual (EIM01476) confirms that employers can pay £6 a week, or £26 a month, to employees who regularly work at home under homeworking arrangements. There is no Income Tax or National Insurance to pay, and you do not need receipts.
The £6 figure is not a cap. An employer can pay more tax-free if it reimburses actual additional costs, such as extra heating and electricity, and keeps records showing how the amount was worked out.
Is the work from home allowance taxable?
The work from home allowance, sometimes called the HMRC home working allowance, is tax-free up to £6 a week only where you have homeworking arrangements with your employer. If there is no agreed homeworking arrangement, the payment is taxed as earnings through payroll. If your employer pays more than £6 a week without evidence of your extra costs, the extra amount is taxed.
Tax-free equipment
Your employer can provide a laptop, monitor, desk, chair or similar items for home working without creating a taxable benefit, as long as any private use is not significant. Ask before buying equipment yourself, because whether a reimbursement is tax-free depends on the exact circumstances.
How to ask your employer
- Check whether your contract or a written policy sets out your homeworking arrangements.
- Ask HR or payroll whether they pay the £6 a week homeworking allowance.
- If not, point out that it costs the employer no National Insurance and is simple to run through payroll.
Backdating Claims for Earlier Years
One of the most overlooked work from home benefits is the backdated claim. If you had to work from home, rather than choosing to, you can still claim relief for the four tax years before 2026/27, as long as you meet the deadline for each.
| Tax year | Claim deadline | Value at 20% | Value at 40% |
|---|---|---|---|
| 2022/23 | 5 April 2027 | £62.40 | £124.80 |
| 2023/24 | 5 April 2028 | £62.40 | £124.80 |
| 2024/25 | 5 April 2029 | £62.40 | £124.80 |
| 2025/26 | 5 April 2030 | £62.40 | £124.80 |
“Had to” means your employer had no suitable office, or your job required you to live too far away to commute. A preference for home working, even if your contract allows it, does not count. Claim through Self Assessment if you file a return, or through HMRC’s online service if you do not.
Work From Home Benefits for Employees
The end of the HMRC claim does not mean employees are left with nothing. The key work from home benefits now come through your employer.
Tax-free homeworking payments
HMRC’s Employment Income Manual (EIM01476) confirms that employers can pay £6 a week, or £26 a month, to employees who regularly work at home under homeworking arrangements. There is no Income Tax or National Insurance to pay, and you do not need receipts.
The £6 figure is not a cap. An employer can pay more tax-free if it reimburses actual additional costs, such as extra heating and electricity, and keeps records showing how the amount was worked out.
Is the work from home allowance taxable?
The work from home allowance, sometimes called the HMRC home working allowance, is tax-free up to £6 a week only where you have homeworking arrangements with your employer. If there is no agreed homeworking arrangement, the payment is taxed as earnings through payroll. If your employer pays more than £6 a week without evidence of your extra costs, the extra amount is taxed.
Tax-free equipment
Your employer can provide a laptop, monitor, desk, chair or similar items for home working without creating a taxable benefit, as long as any private use is not significant. Ask before buying equipment yourself, because whether a reimbursement is tax-free depends on the exact circumstances.
How to ask your employer
- Check whether your contract or a written policy sets out your homeworking arrangements.
- Ask HR or payroll whether they pay the £6 a week homeworking allowance.
- If not, point out that it costs the employer no National Insurance and is simple to run through payroll.
Backdating Claims for Earlier Years
One of the most overlooked work from home benefits is the backdated claim. If you had to work from home, rather than choosing to, you can still claim relief for the four tax years before 2026/27, as long as you meet the deadline for each.
| Tax year | Claim deadline | Value at 20% | Value at 40% |
|---|---|---|---|
| 2022/23 | 5 April 2027 | £62.40 | £124.80 |
| 2023/24 | 5 April 2028 | £62.40 | £124.80 |
| 2024/25 | 5 April 2029 | £62.40 | £124.80 |
| 2025/26 | 5 April 2030 | £62.40 | £124.80 |
“Had to” means your employer had no suitable office, or your job required you to live too far away to commute. A preference for home working, even if your contract allows it, does not count. Claim through Self Assessment if you file a return, or through HMRC’s online service if you do not.
Work From Home Benefits for the Self-Employed
If you are a sole trader or in a partnership, the April 2026 change does not affect you. You can still deduct the business share of running your home as an allowable expense, using either of two methods.
Simplified expenses flat rate
GOV.UK’s simplified expenses for working from home let you claim a fixed monthly amount based on the hours you work at home:
| Hours of business use each month | Flat rate per month | Maximum per year |
|---|---|---|
| 25 to 50 hours | £10 | £120 |
| 51 to 100 hours | £18 | £216 |
| 101 hours or more | £26 | £312 |
The flat rate covers heating, lighting and power. You can claim the business share of your phone and internet on top, because those are excluded from the flat rate.
Which working from home expenses are tax deductible?
- Usually deductible (business share): heating, electricity, water if metered, council tax, home insurance, rent and mortgage interest.
- Deductible separately: the business share of phone calls, broadband and office equipment.
- Not deductible: mortgage capital repayments and purely personal costs.
Actual costs method
Alternatively, work out the business share of your actual bills, such as electricity, gas, council tax, mortgage interest or rent. A common approach is to divide costs by the number of rooms, then by the share of time each room is used for work. This takes more effort but often gives a bigger deduction for people who use a dedicated home office every day.
Work From Home Benefits for Company Directors
If you run a limited company from home, your company can pay you the same £6 a week tax-free, and it can claim the cost as a business expense. Some directors choose instead to have the company pay rent for using part of the home.
A rent arrangement needs a written agreement and a fair figure. The rent is taxable income for you, but you can deduct the related share of household costs, so the net tax is often small while the company still gets a Corporation Tax deduction. Take advice before setting this up, because it can affect business rates and Capital Gains Tax relief on your home.
Work From Home Benefits Worked Examples for 2026/27
These examples show how much the main work from home benefits are worth in practice.
Example 1: Employee paid the homeworking allowance
Leah works from home three days a week under a written homeworking policy. Her employer pays £26 a month, which is £312 a year, tax-free. To receive £312 after tax as extra salary, a basic-rate taxpayer would need about £433 before 20% tax and 8% National Insurance.
Example 2: Sole trader using the flat rate
Ravi is a self-employed web designer who works from home for 120 hours a month. He claims £26 a month, or £312 a year. With 20% Income Tax and 6% Class 4 National Insurance, his saving is about £81 a year, plus the business share of his broadband and phone.
Example 3: Backdated claim
Chloe’s employer closed its office in 2022, so she had to work from home. She never claimed. By claiming for 2022/23 to 2025/26 before 5 April 2027, a basic-rate taxpayer like Chloe could recover about £250.
Council Tax, Broadband and Selling Your Home
- Council tax: working from home does not normally change your council tax. Business rates may apply only if part of your home is used solely for business, for example as a workshop or a room converted for clients.
- Broadband: employees cannot claim for a line they already had for personal use. Sole traders can claim the business share.
- Selling your home: if a room is used only for business, part of any gain could lose Private Residence Relief. Rooms with some personal use usually keep the relief.
These work from home benefits and pitfalls matter most for the self-employed and directors. If you are unsure how your set-up affects your tax, our micro business owners tax services can review it and make sure you claim everything you are entitled to.
Frequently Asked Questions
Can I still claim working from home tax relief in 2026?
Not for the 2026/27 tax year onwards if you are an employee. GOV.UK confirms the relief ended on 6 April 2026. You can still claim for up to four earlier years if you had to work from home during them.
What is the HMRC working from home allowance?
It is the £6 a week, or £26 a month, that an employer can pay tax-free to an employee who regularly works at home under homeworking arrangements. No receipts are needed at that rate.
Is there still an allowance for work from home?
Yes, but it now comes from your employer rather than HMRC. Employers can pay up to £6 a week tax-free under homeworking arrangements. The old work from home tax relief that employees claimed directly from HMRC ended on 6 April 2026.
Can my employer pay me more than £6 a week?
Yes, if the payment reimburses your actual additional household costs and your employer keeps records showing how it was calculated. Payments above that without evidence are taxable.
What are the work from home benefits for the self-employed?
Sole traders can claim flat rates of £10, £18 or £26 a month depending on hours, or the business share of actual costs. The business share of phone and broadband can be added on top.
How far back can I claim working from home tax relief?
Up to four tax years. For 2022/23, your claim must reach HMRC by 5 April 2027. You must have had to work from home, not chosen to.
Does working from home affect my council tax?
Usually not. Business rates may apply only if part of your home is used solely for business and has been changed for that purpose, such as a dedicated workshop or a room for seeing clients.
Final Verdict: Making the Most of Work From Home Benefits
Work from home benefits still exist after April 2026, but they now come through your employer, your business accounts or a backdated claim rather than a simple HMRC form. Employees should ask for the £6 a week allowance, sole traders should claim flat rates or actual costs, and directors should use a homeworking payment or a fair rent. Do not miss the 5 April 2027 deadline for 2022/23.
- Ask your employer about the tax-free £6 a week homeworking payment.
- Check whether you can backdate a claim for 2022/23 to 2025/26.
- See our fixed-fee pricing, or call 0116 4030595 or email info@eternityaccountants.co.uk for help.
✓ Flat rate vs actual costs compared
✓ Backdated claims checked
Why trust this guide
- Written by the Eternity Accountants Editorial Team and reviewed by a chartered management accountant (ACMA, MAAT) with more than 15 years’ UK practice experience.
- Checked against GOV.UK homeworking guidance, HMRC’s Employment Income Manual and the simplified expenses rules.
- Worked examples use 2026/27 Income Tax and National Insurance rates.
- Last reviewed: November 2026.
