Tax relief and working from home in Ireland
With home working here to stay and new laws giving employees the right to work remotely, here’s how to claim financial support if you work from home in Ireland.
Working remotely enables you to cut the cost of travel and transport, but it also means spending more on gas and electricity to heat your home and power your devices.
A fast, reliable broadband connection is vital for many jobs and is required to stay in touch with colleagues which can also add to expenses.
Fortunately, there’s financial support available so here’s an overview of the allowances and tax relief you could be entitled to.
Financial support for working from home
There are two ways you can get financial help for working at home.
- Remote Working Allowance paid by your employer: Your workplace may provide you with a remote working allowance to cover the costs of remote working
- Remote Working Relief: If your employer does not contribute or you’re self-employed you can claim at the end of the year
Working from home allowance
This is an allowance paid by your employer.
If you’re a remote worker or work at home some of the time, your employer can pay you up to €3.20 per day without deducting PAYE to cover the additional costs of working from home. You won’t have to pay Universal Social Charge (USC) or Pay Related Social Insurance (PRSI) either.
If your additional costs are higher than €3.20 your employer can pay you more, but any extra payments will be taxed and PRSI and USC deducted.
Employers are not legally obliged to make this payment but can offer it as an extra benefit to their staff.
Remote working relief
If you don’t get working from home allowance from your employer, you can claim Remote Working Relief from Revenue.ie.
This entitles you to tax relief on your electricity, heating and broadband for the days you spend working from home when you claim expenses directly from Revenue.ie.
What are the rates?
- 30% for electricity and heating
- 30% for broadband
If you claim for previous years, 2107-2022, electricity and heating relief is calculated at 10%. Broadband tax relief only started in 2020.
What expenses can you claim?
If you work remotely either as an employee or are self-employed, you can claim for various utilities based on the number of days you worked at home during the year.
You can only claim for the days you worked from home, so you can’t claim for:
Any amounts paid by your employer must be deducted from your claim.
How working remote working relief is calculated
An example of the calculation for utility costs:
- multiply your bill by the number of days you worked remotely
- divided by 365 - days of the year
- multiply by 0.3 (30%) - tax relief given
So, if your gas and electricity bill is €1,200 and your broadband costs €600 and you worked from home for 150 days in 2022, your tax relief calculation will be:
Electricity & heating
€1200 x 150 days = 180,000
180,000 / 365 days = 493
€493 x 0.30 = €147
Broadband
€600 x 150 days = 90,000
90,000 / 365 = 246
€246 x 0.30 = €74
On this basis, you could be eligible to claim tax back on total expenses of €221.
In terms of what you get back in your pocket, if you pay a tax rate of 20% you’ll qualify for €44 or if you pay the higher rate of 40% you’ll qualify for €88.
What if you pay for broadband in a bundle?
Your broadband may be supplied as part of a package or bundle, for example with TV and home phone.
If a breakdown is given by your supplier, you can claim 30% of this amount but if not Revenue is willing to accept a reasonable portion of the bundle price as your broadband costs.
What if you share gas and electricity bills with someone else?
If energy bills are shared between two or more people, the relief will be apportioned and calculated based on the amount you pay.
For example, if you pay half of your household bills, instead of calculating €500 for electricity x 150 days, you’d calculate €250 x 150 days.
How to apply for Remote Working Relief
To claim Remote Working Relief, you’ll have to complete an Income Tax Return and provide vouched evidence of any expenses you’ve paid.
If you are claiming for 2020 and 2021 you will need to upload receipts and images of bills paid via the Revenue myAccount page. To find out in more detail how to claim for 2022 and previous years, visit Revenue.ie Remotely working from home.
Other ways to save money when working from home
Extra heating for your home, running office equipment and even putting the kettle on several times a day can all add to your energy bills. You may also need a faster, more reliable connection to cope with video conferencing and file exchange which could mean higher broadband costs.
We’ve put together several guides to help you cut the cost of working from home.
Working from home tax relief FAQs
What is the National Remote Work Strategy?
It’s the government’s plan to increase remote working in Ireland. Under the National Remote Work Strategy:
- your employer will be unable to decline a request to work from home without good reason
- public service workers will be encouraged to spend 20% of their working week away from the office
Revenue.ie defines remote working as when you are required to work either
- at home on a full-time or part-time basis or
- split working hours between home and your normal place of work
Allowances for remote working don’t apply when you bring work home outside of normal working hours.
What is hybrid working?
Hybrid working is where you split your time between the workplace and working remotely.
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