What is homeworking?

There is no statutory definition of what constitutes a home worker, nor a single collective set of principles which guide what can and cannot be claimed as a tax deduction. Instead, an individual has to identify allowable expenditure using the various general and specific rules around expenses.

There are some specific exemptions which are addressed further below. Where none of these apply, the general rules for expenses apply. These are detailed in the Expenses ― general rule guidance note. Essentially there are two requirements regarding expenses which are deductible for an employee:

1. •

   the employee must be obliged to incur and pay it as the holder of the employment

2. •

   the amount is incurred wholly, exclusively and necessarily in the performance of the duties of the employment

ITEPA 2003, s 336

HMRC has guidance around home working and expenses. It sets out that it requires the following conditions to be met:

1. •

   substantive duties of employment are performed at home

2. •

   the employee cannot perform their duties without appropriate facilities

3. •

   appropriate facilities are not available