Working from home – deductible expenses

The global Covid-19 pandemic and the accompanying lockdowns necessitated that many people work from home. For many people it has also initiated a longer-term shift to a hybrid working model where many people work from home at least one day a week or more.

Anyone working from home will incur some expenses that the employer would have previously borne. For instance electricity costs heating costs and business telephone costs. But are these costs deductible for an employee? Are they deductible for someone who is self-employed? How is office equipment purchased for home use treated for tax purposes? This article seeks to answer all those questions.

Reimbursement by an employer

The most defensible and tax-efficient way for an employee to claim working from home expenses is for the employer to provide a reimbursement of those expenses.

ITEPA 2003 s 316A contains the relevant legislation in relation...