More than a quarter of working adults in Great Britain were hybrid working between January and March 2025, according to ONS data. That’s a lot of people with a spare bedroom doubling as a workspace — and a reasonable expectation that HMRC will recognise some of the cost involved. Using your home as an office is genuinely commonplace now, but the tax rules around it have never been straightforward, and they just got a little more complicated.

From 6 April 2026, HMRC removed the ability for employees to claim tax relief for working from home expenses on their self-assessment return. That’s a significant shift. But here’s what matters: the change only applies to employees. If you’re self-employed or running a limited company, the rules are different — and there’s still plenty to legitimately claim. The key is knowing which regime applies to you.

Until the 2025–26 tax year, employees who were required to work from home could claim tax relief on their homeworking costs — either at the flat rate of £6 per week (£312 per year) or by claiming the exact amount they’d spent, provided they had receipts. That option is now gone for the 2026–27 tax year onwards.

From 6 April 2026, employees can no longer claim this tax relief through self-assessment. The good news, if your employer is on board, is that a new exemption allows employers to reimburse employees for certain work-related costs — including homeworking expenses — without triggering an Income Tax or National Insurance charge. So the route to relief now runs through your employer, not through a personal claim to HMRC.

If you worked from home in previous tax years and haven’t yet claimed, you may still be able to do so — but you’ll need evidence that you were required to work from home (not that you simply chose to), and receipts or bills if you’re claiming exact amounts rather than the flat rate. That eligibility bar was tightened from the 2022–23 tax year, so convenience-based claims — working from home because the office is full, or because you preferred it — won’t hold up.

The practical takeaway for employees: speak to your employer about whether they’ll reimburse homeworking costs directly. That’s now the only tax-efficient route available for the current year.

If you’re self-employed and your home is genuinely your base of operations, the picture looks quite different. HMRC has always allowed sole traders to claim a proportion of household costs against their business income — and that hasn’t changed.

You have two approaches to choose from.

The simplified flat rate

HMRC’s simplified expenses scheme lets you claim a flat monthly amount based on how many hours per month you work from home. For 25 to 50 hours, that’s £10 per month. For 51 to 100 hours, it’s £18. For over 100 hours, it’s £26. No receipts required — it’s a straightforward deduction on your self-assessment return.

Claiming actual costs

The alternative is to calculate the business proportion of your actual household bills — mortgage interest or rent, council tax, utilities, broadband — based on the number of rooms used for work and the proportion of time they’re used. This approach typically produces a higher deduction but requires more record-keeping and a defensible methodology.

In our experience, most sole traders who work from home most of the week are better off working through actual costs rather than the flat rate — but it does require you to keep those bills and apply a consistent apportionment method. If you’re not sure which approach suits you, it’s worth a conversation with an accountant before your next self-assessment return.

If you operate through a limited company and work from home, you have a couple of routes available — and they work quite differently to the sole trader position.

Charging rent to your company

One option is to draw up a formal licence agreement between yourself and your company, under which the company pays you rent for using part of your home as office space. The rent is a deductible business expense for the company, but you’ll need to declare it as income on your personal tax return. You can offset costs against that rental income — but the rules here are specific, and you need to be careful not to inadvertently trigger a capital gains tax issue when you eventually sell the property.

The £6-per-week company contribution

A simpler approach for most owner-managed businesses is for the company to pay you a homeworking allowance of £6 per week (£312 per year). This is a modest amount, but it’s HMRC-approved, requires no complex calculation, and is free of tax and National Insurance for both you and the company. For directors who only use a small part of their home for business, this is often the cleanest solution.

The right approach depends on how much of your home you genuinely dedicate to the business, the level of your household costs, and your wider tax position. Both routes are legitimate — what matters is that you apply them correctly and consistently.

Across all of these scenarios, HMRC applies a consistent principle: the use must be genuine and for business purposes. A laptop on the kitchen table for an hour a day is unlikely to support a significant claim. A dedicated room used exclusively or predominantly for client work or administration is on much firmer ground.

For sole traders and limited company directors, the stronger your claim, the more important it is to document it properly. That means being able to show which rooms you use, for how long, and what proportion of your household costs those rooms account for. HMRC can and does ask questions about home office claims — particularly larger ones.

There’s also the question of exclusivity. If a room is used for business and personal purposes, you can only claim the business proportion. A room used exclusively for business — say, a dedicated office with a separate door — supports a fuller claim, but also raises the question of whether you’ve created a business use of part of your home that might have implications for private residence relief on a future sale. It’s one of those areas where the tax efficiency of the claim needs to be weighed against the wider picture.

For most people using a home office in a sensible, proportionate way, the risk is low and the claim is straightforward. But it’s always worth being precise rather than optimistic about the numbers you put in.