Millions of employees who work from home are set to lose a valuable tax benefit under new rules announced by the Labour government, a move described by critics as a 'slap in the face' for remote staff.
What is Changing for Home Workers?
From April 2026, the government will abolish the simplified £6 per week tax relief that employees can claim for additional household expenses incurred while working from home. This flat-rate allowance, which required no receipt submission, will be replaced by a system where workers must claim for actual, evidenced costs.
The change applies even to those mandated to work remotely, such as individuals whose employer has no office space or workers who require specific adaptations for their role. Experts are urging anyone eligible who has never claimed to speak to their accountant now and consider backdating their claim before the rule takes effect.
Industry Backlash and Warnings
The decision has drawn sharp criticism from business and financial advisers across the UK, who warn of increased administrative burdens and hidden costs.
Kate Underwood, founder of Southampton-based Kate Underwood HR and Training, stated that the relief was a small recognition that working from home is not free. "They are already paying extra to heat the house and run the kit," she said. "Now it becomes 'prove every penny' and hope HMRC agrees." She warned small businesses face a difficult choice: absorb some costs, manage overwhelming paperwork, or risk losing valuable staff who can no longer afford the expense.
Colette Mason, an author and AI consultant at London's Clever Clogs AI, called the move "spectacularly short-sighted." She argued that by adding complexity for small firms, the government is pushing the economy towards automating roles. "The small amount the Treasury saves... will be dwarfed by the long-term loss of revenue from wages and payroll taxes," Mason claimed.
Mixed Views on Impact and Fairness
While critical, some advisers see a logic behind the revision. Samuel Mather-Holgate, an independent financial adviser in Swindon, noted the relief was "seldom claimed" due to its modest value. He suggested the recent massive increase in the minimum wage would offset the loss for lower-paid workers. However, he urged a carve-out for disabled people unable to work in an office.
The sentiment of frustration was echoed by David Stirling, an independent financial adviser in Belfast, who said homeworkers now face extra admin and the task of "proving they boiled the kettle." He concluded that remote workers are being "quietly squeezed by the Chancellor."
The consensus among experts is clear: both employers and employees must now prepare for a more bureaucratic system and factor these changing costs into pay and policy decisions well before the April 2026 deadline.
