Expense Reimbursement for Employees WFH in the UK: A Guide for Overseas Employers

Many remote workers abroad will opt to work from home, rather than use shared workspaces, and that raises questions about how tax and employment regulations will be applied to WFH. 

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Many remote workers abroad will opt to work from home, rather than use shared workspaces, and that raises questions about how tax and employment regulations will be applied to WFH.  While many countries will still apply labor laws to WFH such as health and safety rules, it is less clear how expenses will be treated for tax purposes.

The reason is that when expenses are incurred in a home office, they are often mixed with personal use so there has to be some guideline to give employees.  Otherwise, they may find that reimbursement for certain expenses will be taxable as a benefit unrelated to work.

What types of expenses can be reimbursed to remote workers in the UK?

If you have remote employees in the UK, there are limits on reimbursable expenses, and methods to calculate the non-taxable portion.  Prior to June 2020, most reimbursements were taxable to the employee (compared to employer direct purchases) but those rules were relaxed due the pandemic until April 2021.

Work equipment (laptop, desk, monitor, chair, etc.):  Equipment that is purchased exclusively for work purposes can be reimbursed tax free to the employee...read more

Shield GEO makes international employment simple. Our customers use Shield GEO to employ and payroll hundreds of workers in over fifty countries. Find out more.

Tim Burgess

Director, Shield GEO Services Ltd

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