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HMRC internal manual

Employment Income Manual

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HM Revenue & Customs
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Employment income: household expenses: broadband internet charges

Section 316A ITEPA 2003

We are often asked if employers can reimburse an employee’s broadband internet charges, tax free, under Section 316A.

The section applies to reasonable additional household expenses. So if an employee who begins to work from home under homeworking arrangements (see EIM01472) is already paying for a broadband internet connection at home, there is no additional expense. The employer cannot, therefore, reimburse the employee’s broadband internet charges, tax free, under Section 316A. Any such payment that the employer may decide to make should be subject to PAYE and NICs.

On the other hand, if the employee does not already pay for a broadband internet connection at home, and needs one in order to work from home under homeworking arrangements, the broadband fee is an additional household expense that the employer can reimburse, tax free, under Section 316A.

If an employee is entitled to receive tax free payments in accordance with the preceding paragraph, they will not lose that entitlement if they change from one homeworking employment to another.