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At a glance

Homeworking rates and allowances:

Fixed rates for homeworking are agreed by HMRC: these amounts can be paid by employers to their homeworking employees to reimburse them for the additional costs of things such as light and heat used when homeworking. 

Alternatively, employees may be able to claim actual costs of homeworking if wholly, exclusively and necessarily incurred or in job-related accommodation. See Working from home: employer/employee

These are the maximum amounts that may be paid by an employer, without requiring a receipt, or evidence of expenditure by the employee.

Year Rate per week
From 6 April 2020

£6 (or £27 per month)

From 6 April 2012

£4 (or £18 per month)

From 6 April 2008 to 5 April 2011

£3

From 6 April 2007

£2

 

If higher amounts are paid these need to be evidenced by receipts, and the employer must disclose amounts reimbursed on form P11D, unless there is a specific dispensation in place (pre 5 April 2016) or they are approved under the new Exemption for paid and reimbursed expenses (post 5 April 2016).

COVID-19

The COVID-19 Homeworking exemption to Income Tax & NICs where the employer reimburses home office equipment expenditure will be extended until 5 April 2022.

HMRC has provided guidance for employees who are homeworking due to the coronavirus crisis, see COVID-19: Working from home.