As promised in the Budget 2021, an amendment to the Income Tax Regulations 2021 has been laid before Parliament and is due to come into force on 31 March 2021. The temporary exemption from Income Tax for amounts reimbursed to an employee for expenses that they have incurred in obtaining home office equipment, for the sole purpose of enabling home working necessitated by the coronavirus pandemic, has been extended. The temporary tax exemption will now apply to amounts reimbursed on or after 11 June 2020 but before the end of the tax year 2021/22. The Social Security Contributions Regulations 2021, which have also been laid before Parliament and are due to come into force on 6 April 2021, ensure that such expenses reimbursement is additionally to be disregarded for NICs purposes during the tax year 2021/22.
The Social Security Contributions (Disregarded Payments) (Coronavirus) Regulations 2021 also extend the temporary NICs disregard of employer-reimbursed relevant coronavirus (COVID-19) antigen test costs to the tax year 2021/22. The corresponding Income Tax exemption for the reimbursement of the costs of relevant coronavirus antigen tests is contained in the Finance Bill 2021, which has now had its first reading in the House of Commons. A relevant test for these purposes is one that detects the presence of a viral antigen or viral ribonucleic acid (RNA) specific to severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2). Therefore, antibody tests, which detect whether someone has previously been infected with COVID-19, are not covered by these provisions.