UK Ends Home Working Tax Relief and Rejects £18,000 Personal Allowance Increase

HM Revenue and Customs ended the standalone home working tax relief on April 6, removing the option for employees to claim a weekly £6 deduction in the current tax year. Workers required by their employer to work remotely between April 6, 2022 and April 5, 2026 may still submit backdated claims.

The relief covered additional household costs such as business telephone calls and energy use in a designated work area.

A petition with more than 31,000 signatures called for the personal allowance to rise to £18,000. The Treasury responded on May 5 that the government has no plans to make the change. Officials stated that increasing the threshold would reduce annual revenue by more than £40 billion.

The Treasury said the lost revenue would equal roughly one-fifth of the NHS budget in England or about two-thirds of defence spending. Ministers noted that the current £12,570 allowance has stayed frozen since 2021. They pointed to increases in the minimum wage and funded childcare hours as alternative support for lower-income households.