Working from home tax relief has changed for 2026/27: employees can no longer claim the £6 a week deduction from HMRC for the tax year that started on 6 April 2026. Employees who had to work from home can still claim for the previous 4 tax years, and employers can still pay £6 a week tax-free. The self-employed and limited company directors have separate rules, which remain in place.

This guide explains what each group can claim now, what you can still backdate, how the flat rates compare with actual costs, and how directors can take home-office costs out of their company tax-efficiently.

Working from home tax relief at a glance (2026/27)

Who you are	What you can claim for 2026/27
Employee, costs not reimbursed	Nothing for 2026/27; past 4 years only if you had to work from home
Employee, paid by employer	Up to £6 a week (£26 a month) tax-free, more with evidence
Self-employed sole trader	Flat rate of £10 to £26 a month, or a share of actual costs
Limited company director	Tax-free homeworking payment from the company, or a rent arrangement

Employees: the end of working from home tax relief claims

From 6 April 2026, the law no longer allows an employee to deduct unreimbursed household expenses for working at home. GOV.UK now states that you cannot claim tax relief for working from home for the 2026 to 2027 tax year. This applies whether you work from home every day or two days a week.

The removal of working from home tax relief only affects costs your employer does not pay back. Payments your employer makes for homeworking are still exempt, and travel expenses to a temporary workplace are not affected.

Can I still claim for past years?

Yes. Working from home tax relief can still be claimed for the 4 previous tax years, which for a claim made now means 2022/23 to 2025/26. You must meet the old test for each year:

• You had to work from home, for example because your employer had no office or your job required you to live far from it.
• You did not simply choose to work from home. Hybrid working under your contract, or staying home because the office was full, does not qualify.

You can claim a flat £6 a week without receipts, or the exact extra costs with bills to prove them. For 2022/23 onwards, HMRC asks for evidence that you had to work from home, such as a letter from your employer. The relief is given at your tax rate, so £6 a week is worth £62.40 a year to a basic-rate taxpayer and £124.80 to a higher-rate taxpayer. If you file a Self Assessment return, you must claim through the return. Our guide on how long a tax rebate takes explains what happens next.

Employers: tax-free payments that replace working from home tax relief

Employers can still pay staff up to £6 a week, or £26 a month for monthly paid staff, free of tax and National Insurance, with no need to justify the amount. The conditions are:

1. There must be a homeworking arrangement between you and the employee, usually in writing.
2. The employee must work at home regularly under that arrangement. A fixed pattern, such as two home days a week, counts. Taking work home in the evening does not.
3. The payment covers additional household costs, such as heating and electricity.

You can pay more than £6 a week tax-free if you can show the higher amount reflects the extra costs, either through a scale rate based on a survey of costs or by reimbursing actual bills. These payments do not need to go on a P11D or through the payroll.

With the employee claim gone, a homeworking payment is now the only way staff can receive this help tax-free, so it is a low-cost benefit worth reviewing in your payroll.

Self-employed: working from home tax relief through your accounts

Sole traders and partners are not affected by the 2026 change, because their working from home tax relief comes through their business accounts rather than the employee rules. You can still claim the cost of using your home for business against your profit, using one of two methods.

Option 1: simplified expenses flat rate

Hours of business use at home per month	Flat rate per month
25 to 50	£10
51 to 100	£18
101 or more	£26

The flat rate covers heating, lighting and power. It does not include phone or internet costs, which you can claim separately for the business share.

Option 2: a share of actual costs

You work out the business proportion of household bills, usually based on the number of rooms used for work and the hours they are used. This can include heating, electricity, water, council tax, mortgage interest (not capital repayments) or rent, and insurance. It takes more work but often gives a larger claim for anyone with a dedicated office.

For more ideas, see our list of expenses you can claim as self-employed.

Worked example: a Horwich graphic designer

Priya is a self-employed graphic designer in Horwich who works from a spare bedroom about 120 hours a month. Her house has 5 rooms (excluding kitchen and bathroom), and her heating, electricity, water and council tax total £4,200 a year.

Method	Annual claim	Tax and Class 4 NI saved at 26%
Flat rate (£26 x 12)	£312	£81
Actual costs: 1 room of 5, used 40% of the time	£336	£87

Here the two methods give similar results, so the flat rate saves record-keeping. If Priya’s bills were higher, or she used the room full time, the actual-cost method would pull ahead. The saving assumes she is a basic-rate taxpayer paying 20% income tax and 6% Class 4 NI.

Limited company directors: your options

Directors are employees of their own company, so the employee rule change applies to them too. A director can no longer claim working from home tax relief personally on their tax return for 2026/27. There are two better routes.

The company pays you a homeworking allowance

If you work from home regularly under an agreed arrangement, the company can pay you £6 a week or £26 a month tax-free. That is £312 a year out of the company with no tax or NI for you, and the company deducts it for Corporation Tax, saving £59.28 at 19% or £78 at 25%. Record the arrangement in a board minute and pay it through the company bank account.

Renting space to the company

Some directors charge the company rent for using part of their home as an office. The company deducts the rent, and the director reports it as income on their own return, with a deduction for the matching share of household costs. Done properly, the taxable profit can be small. This needs a written agreement and a fair rate, and using a room exclusively for business can affect Private Residence Relief when you sell your home, so take advice first.

For the wider picture on drawing money from your company, read our guide to salary and dividend planning for directors.

Frequently asked questions

Get your home-working costs right

Whether you employ staff, work for yourself or run a limited company, working from home tax relief is still available in some form if you use the right route. Cangaf’s ACCA-qualified team can review your past claims, set up tax-free homeworking payments and prepare your Self Assessment return. Get a fixed-fee quote today.

Official guidance: Tax relief for employees: working from home, Simplified expenses: working from home, EIM32759: homeworking expenses from 6 April 2026 and EIM01476: homeworking payments by employers.

Related guides: SEIS and EIS Tax Relief Explained: Limits, Reliefs and April 2026 Changes (2026/27) · What is a Creative Tax Relief