Working from home costs for employees

Broadband etc.

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As a result of Covid-19 and lots of employees now working from home, I think there will be a big shift toward employees continuing to WFH post Covid. One of the main issues to overcome with WFH for employees and employers will be the strength and security of their employees' home broadband. We may see employers offering to fund the cost for the employees or even arrange a better quality broadband install for them.

The use of home as office allowance is now £6 per week which I understand can be paid with no requirement to prove the level of expenditure. 

With broadband costs, there will of course be an element of private use.

Some employers may withdraw benefits such as company cars due to WFH, and offer alternatives such as providing better broadband for the home (although I appreciate this is not a like for like benefit).

The costs of broadband are likely to exceed the £6 per week, but probably not by a great deal. There are a couple of possible circumstances here, including:

a.) Employer organises and pays for broadband instal and ongoing costs but requires employee to reimburse them for this. Could this be treated as a salary sacrifice and are there any other tax related issues with this

b.) Employer organises and pays for broadband install and ongoing costs but does not require employee to reimburse them. There will be some private use of the broadband but the majority one would assume would be business related, could the employee reimburse the employer the amount that exceeds the £6 p/w from their net pay to avoid any BIK?

 

Any other thoughts would be greatly appreciated. 

 

Replies (18)

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blue sheep
By NH
05th Aug 2020 10:00

employer provides a company mobile phone contract to employee - 4G hot spotting for internet services?

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Replying to NH:
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By Mr_awol
05th Aug 2020 10:24

If you can put up with the lag of a hosted desktop/virtual terminal then maybe. I wouldn't be keen though.

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By Mr_awol
05th Aug 2020 10:22

Employee continues to pay for their own telephone line/broadband - probably using the cheapest service imaginable even if its next to useless.

Employer then pays for a second line for homeworking purposes which, as I understand it, can be provided tax free.

Not sure what happens if employee then cancels their own phone/broadband services. I'd want to reassure myself that step 2 was correct before moving onto step 3. It might be that e'ee just has to keep the cheap broadband running even thought in all likelihood they'd never use it as they'd connect everything to the better work broadband.

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RLI
By lionofludesch
05th Aug 2020 17:40

I can't imagine anything more airy-fairy that an estimate of the split between work and personal broadband costs.

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By Munch
06th Aug 2020 10:00

I have worked from home on and off for years and the thought of asking the business to cough up for broadband that the whole family uses has never crossed my mind. What is important is that access to the office networks is secure. Provision of a laptop/ mobile phone etc should be provided. If you really have demonstrable issues with connectivity (eg if family usage causes wifi probs) then a second truly dedicated line could be attached, but as an exception. I would be very careful about building policies around this. The costs will quickly escalate out of control. My experience is that employees that try to claim this stuff have same mindset as those that think the company should pay for every coffee they drink on the road. If you already have wifi at home as most do why the hell would you ask the company to contribute. Tiny minds. People need to think whether they want a sustainable job in a sustainable company before penny pinching.

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Replying to Munch:
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By bauer_hilts
07th Aug 2020 09:50

Not sure I have ever agreed as much with a comment in my life! Spot on.

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Replying to Munch:
By djn24
07th Aug 2020 09:58

Munch wrote:

I have worked from home on and off for years and the thought of asking the business to cough up for broadband that the whole family uses has never crossed my mind. What is important is that access to the office networks is secure. Provision of a laptop/ mobile phone etc should be provided. If you really have demonstrable issues with connectivity (eg if family usage causes wifi probs) then a second truly dedicated line could be attached, but as an exception. I would be very careful about building policies around this. The costs will quickly escalate out of control. My experience is that employees that try to claim this stuff have same mindset as those that think the company should pay for every coffee they drink on the road. If you already have wifi at home as most do why the hell would you ask the company to contribute. Tiny minds. People need to think whether they want a sustainable job in a sustainable company before penny pinching.


I agree with this 100%. Most staff would like the freedom of some home working. Time saving in not travelling to work plus saving in fuel costs should make the broadband cost pretty irrelevant I would say. Especially as they almost certainly have it already. I wouldn't be looking at paying for the staff to have broadband at home.
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Replying to Munch:
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By Rgab1947
07th Aug 2020 09:59

I work from home and am paying extra for broadband speed just top be able to operate (6mb does not do it for me. I need 32mb minimum).

There is considerable cost for operating from home so the snide comment on tiny minds is a bit rich.

But maybe you have a 6 bedroom mansion, one dedicated to a home office, + 3 kids gaming 24/7. Many of us do not!

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Replying to Rgab1947:
blue sheep
By NH
07th Aug 2020 10:08

if the employer requires you to work from home they should be willing to cover extra costs, if however you normally commute and have chosen to work at home that is your choice, you are saving a fortune on the commuting costs so I would expect an employer to not have to subsidise that.

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Replying to Rgab1947:
paddle steamer
By DJKL
07th Aug 2020 11:00

Six bedrooms does not a mansion make (though we do not use them all as bedrooms, two are studies and one is akin to a library)

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Replying to DJKL:
Stepurhan
By stepurhan
07th Aug 2020 13:04

You only have books in one room? Weird!

To get back to the point, it depends whether employers are actually requiring staff to work from home. If they are and that is resulting in additional costs then the employer should cover those additional costs. I agree that attempting to split an existing bill would be silly, but a dedicated line would definitely qualify. A higher speed line could be argued both ways if the employee also gets private benefit of the enhanced line.

Commuting costs are a bit of a red herring, not least because not everyone has commuting costs (so additional home-working costs are just extra cost). I have worked at several jobs where my office was within walking distance, though I might be happier walking for longer distances than most.

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Replying to Rgab1947:
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By bauer_hilts
07th Aug 2020 13:19

Rgab1947 wrote:

I work from home and am paying extra for broadband speed just top be able to operate (6mb does not do it for me. I need 32mb minimum).

There is considerable cost for operating from home so the snide comment on tiny minds is a bit rich.

But maybe you have a 6 bedroom mansion, one dedicated to a home office, + 3 kids gaming 24/7. Many of us do not!

Hardly. Do you normally commute? Do you have travel costs that you are no longer incurring? If you have been forced to work from home due to the pandemic then I dont agree that an employer should be paying more for your broadband. Where I work we havent agreed yet in terms of the policy re WFH going forwards yet. In my opinion if a business chooses going forwards to implement policies requiring their workers to work remotely then it would make sense that they contribute to that in some form. If however the employee chooses they want to WFH and the employer agrees to this then I dont think the employer should have to fund this.
In terms of atm if you are saving on all your commuting costs you are surely saving both time and money by working from home!!

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By Rgab1947
07th Aug 2020 09:55

"The costs of broadband are likely to exceed the £6 per week, but probably not by a great deal"

WFH requires a bit more than the poor Sky standard speed or bandwidth.

One client pays £52, a friend who admittedly is in IT so needs a lot pays £72.

Then the electricity (2 monitors chew), extra space needed as a semi-permanent WFH is not the dining room table or a desk in the bedroom. One client bought a garden shed for WFH.

HMRC rules as to WFH is not fit for purpose, certainly not after Covid.

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By pauljohnston
07th Aug 2020 10:03

The way to do this is (and your Ltd Co clients who have broadband may be interested.)

Phone Line is installed and paid for by staff member. Employer installs Broadband piggy backing on the phone line but under a different contract. As long as personal broad band use is incidental there is no benefit in kind. However if the broad band supplier has a separate charge for extra date then this is a different proposition. ZEn have an unlimited use 70gb fibre plan at around £30-£35 per month.

If the employer wants the employee to have a desk phone he/she would be better to look at a plan such as that offered by Voxhub which transfers the whole business phone system to voip. This allows calls between employers and the availability to transfer incoming calls to other members and much more. The calls can also be transferred to mobiles seamlessly if employee is not in the office

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By Andy Reeves
07th Aug 2020 10:13

If there is a demonstrable need for the faster, more secure broadband, I would have no issue with the employer paying for the install and ongoing costs while WFH continues. There is no marginal cost incurred in the private use, and I doubt HMRC would take on the large number of cases that will be out there for what would be a miniscule tax gain.

I would probably not pay the £6 per week on top though.

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By chrisowen
07th Aug 2020 10:47

I thought the £6 per week was to cover all expenses, not just broadband ?

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By SteveHa
07th Aug 2020 13:06

SA2016 wrote:

b.) Employer organises and pays for broadband install and ongoing costs but does not require employee to reimburse them. There will be some private use of the broadband but the majority one would assume would be business related,

I wouldn't bet on that. Work related bandwidth is likely to be quite low, whilst personal including a Netflix program or two would be quite heavy.

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By SA2016
10th Aug 2020 11:34

Thank you all for your replies thus far. This is not a question of whether the employee expects their employer to reimburse them, it is I can see that employers may want to offer it as a perk to their staff.

If they do and there is only one line, because the employer do not want to over complicate things, is there a standard pre arranged % you could agree with HMRC in respect of the private use which would be included on a P11d. Everybody would be different so I cant see how this would be dealt with on a case by case basis. Could it not be as simple as agreeing that say 50% is business and 50% is private?

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