Part of the Budget small print has revealed the imminent end of a tax relief which may impact some agencies who have staff working from home.
Tax relief for employees who work from home has been tweaked, so that for some people it will disappear altogether.
If an employer gives the staff member money to cover the costs of working from home, they can still do so without deducting income tax and National Insurance.
However, from April 2026, employees can no longer claim the tax benefits if they don’t get a payment from their employer.
Sarah Coles, head of personal finance at Hargreaves Lansdown, says:“It was a useful tax boost that gained more attention during the pandemic, and possibly as a result of more widespread use, the government has decided it’s time for it to go.”
The small print from last week’s Budget has also revealed plans to make people pay tax more quickly when they work for themselves or where they pay additional tax through self-assessment.
From 2029, if they’re an employee, they will have to pay more of their tax bill as they go along through the PAYE system, and if they work for themselves, the government will consult early next year on changing the system so they have to pay the tax sooner.
Coles says that on paper, this should help avoid some people being wrong-footed by the gap between earning and paying tax. But she cautions that there’s going to need to be careful consideration of the transition, so people aren’t suddenly confronted with tax bills for multiple years.
