With tax relief set to rise for thousands of homeworkers in January 2022, here’s how to claim financial support if you work from home in Ireland.
Ireland has one of the highest work from home rates in Europe, with up to 22% employees working remotely when possible.
To increase this further, the Irish government plans to make hybrid working available to everyone in relevant industries by the end of 2022.
Hybrid working is where you split your time between the workplace and working remotely. Some examples of relevant industries include:
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 to workers in the form of tax relief and allowances and here’s what you can claim.
There are two ways you can get financial help for working at home.
Here’s an overview of the allowances and tax relief you’re entitled to from your employer or directly from Revenue.ie.
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.
Employers are not legally obliged to make this payment, but can offer it as an extra benefit to their staff.
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.
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 if you claim expenses directly from Revenue.ie.
The 2022 rates are:
In this year’s budget, the Government announced that tax relief on 30% of electricity, heating and broadband expenses will be given for all days spent working from home.
If you work remotely either as an employee or 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.
An example of the calculation for utility costs:
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
€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.
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.
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.
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 or 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 2021 and previous years, visit Revenue.ie Remotely 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.
It only takes a few minutes to find a cheaper deal and start saving
It’s the government’s plan to increase remote working in Ireland. Under the National Remote Work Strategy:
Revenue.ie defines remote working as when you are required to work either
Allowances for remote working don’t apply when you bring work home outside of normal working hours.