Learn how the working from home easement is coming to an end. If you are an employer whose team work from home or an employee benefiting from working from home arrangements, you need to take account of the new rules taking effect from 5 April 2022.
As the Government lifts Coronavirus restrictions, working from home is no longer a legal requirement and the easement of the rules surrounding claiming and reimbursing of working from home expenses tax and national insurance free will come to an end on 5th April 2022.
Throughout the pandemic most employees who have worked from home will either have been reimbursed £6 a week by their employer or made a claim via their self assessment return or Form P87 to claim tax relief on it.
The pre-COVID rules will come back into play from 6 April 2022. So, what are the rules they we now all need to play to?
If an employee works from home under a ‘homeworking arrangement’, the employer will be able to reimburse the employee without any liability to income tax or national insurance at the £6 per week rate, without any comeback. The reimbursement could be greater, but HMRC would expect to see supporting evidence to back this up.
What is a bona fide home working arrangement?
- there must be an arrangement in place between the employee and the employer.
- the employee must work at home on a regular basis under the arrangement.
- the arrangement does not have to apply to all employees.
- HMRC accepts that an employee works from home where working from home is frequent and follows a set pattern.
If an employee works from home under a working from home but the employer does not make a reimbursement then the employee will still be able to claim tax relief for legitimate expenses BUT the expense will have to have been incurred wholly, exclusively and necessarily in the performance of duties of the employment.
In practice, we are reverting back to the pre-Coronavirus rules but as more employees are now working from home than ever before, these rules are very important to abide by.
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