Skyping in from the sofa this week?
If Covid-19 restrictions have you working from home for the first time, there’s some handy information you should know about how you can claim some tax relief on your new set-up.
“There are already estimated 100,000+ people who work from home and Revenue has made provisions for these people to be reimbursed for work-related expenses,” said Joanna Murphy, CEO of Taxback.com.
“Now these provisions can apply to the new wave of e-worker also. This is a benefit that, in our experience, is already heavily underutilised. But now more than ever people are going to need all the financial support they can get”.
How much can I claim, and how?
The main additional costs include heating, electricity and broadband expenses (extra biscuits are not covered). An employer can pay €3.20 a day to their employee to cover these additional costs.
“This payment is tax-free, which means they won’t be deducting PAYE, PRSI or USC from that amount. It isn’t a legal obligation to do this, however.” explains Ms Murphy.
“But even if your employer doesn’t and/or isn’t in a position to pay the €3.20, these expenses are eligible for tax relief meaning the ‘home-worker’ can claim tax back on them. Any claims made will need to be supported with evidence in the form of receipts and possibly a letter from your employer stating that you do, in fact, work from home and that they do not reimburse you for these expenses.”
The allowance or rebate claimed must be reasonable, allowing for the fact that the utilities are for both personal and work and benefit everyone else in the home, so the refund received will be based on only a portion of the overall expenses.
“And even if your employer does reimburse the employee – if the cost run-up exceeds the €3.20-mark, tax can still be reclaimed on the difference.”
The take-away? It’s well worth holding on to all those bills and receipts. Every little helps.