Remote work allows you to work full-time or part-time from the comfort of your home. This setup involves accessing the employer’s computer system, managing emails and files, and participating in developing ideas, products, and services remotely.
If you are working from home, you may qualify for tax relief on costs like electricity, heating, and broadband. Claiming home office expenses, such as furniture or equipment, is separate from Remote Working Relief.
In this guide, we’ll explain Remote Working Relief, offer an example of the eligible amount for tax relief, and outline the steps for applying for this benefit.
What is Remote Working Relief?
Remote Working Relief is a tax benefit for individuals who work remotely, from their home. As part of this relief, eligible individuals can claim 30% of the expenses incurred for electricity, heating, and broadband.
You calculate allowable remote working costs by including only the days you actively worked from home. Exclude weekends, public holidays, annual leave, and any days when work was brought home outside of regular working hours.
After taking out weekends (104 days), public holidays (10 days), and annual leave (20 days), an average year boils down to just 232 working days. So, in most cases, this is the maximum number of days you could claim for – not the full 365.
Allowance paid by your employer
As a remote worker, your employer can provide you with a daily payment of up to €3.20 without deducting PAYE, PRSI, or USC, intended to cover added expenses like electricity, heating, and broadband associated with working from home.
If your employer provides a daily payment exceeding €3.20 to cover expenses, you will be subject to normal tax, PRSI, and USC deductions on the amount exceeding €3.20.
If you apply for Remote Working Relief, any reimbursement from your employer for remote working expenses should be subtracted from your claim.
Who can claim Remote Working Relief?
- If your employer does not pay you a working from home allowance, you can claim tax relief during the year or after the end of the year.
- If your employer pays you a working from home allowance, you can still apply for Remote Working Relief. However, it’s crucial to deduct any reimbursement received from your employer for remote working expenses when making your claim.
How to claim work from home tax relief
-
1. File Income Tax Return online
Use Revenue's ``MyAccount`` service and in 'Tax Credits and Relief', select 'Your job' and then select 'Remote Working Relief'.
-
2. Record bills
Keep a record of relevant bills for remote work expenses, like internet and electricity bills.
-
3. Use receipts tracker in myAccount
Input and organise your receipts in Revenue’s Receipts Tracker within myAccount for easy inspection.
-
4. Consult a professional
If the tax relief process seems complex or you have eligibility questions, consider consulting a professional accountant for guidance.
How to calculate Remote Working Tax Relief
Your relief is calculated using the formula (A x B) ÷ C – D x 30%, where:
(A) is your allowable utility bills for electricity, heat and broadband
(B) is your number of remote working days
(C) is the number of days in the relevant year of assessment
(D) is any remote working allowance reimbursed by your employer.
Example calculation 1
Aaron worked from home for 200 days. The cost of his electricity, heat, and broadband for 2023 was €3,000. Aaron does not receive an allowance for remote working from his employer.
| Description | Calculation | Amount |
|
Aaron spent an annual total of €3,000 on utility bills for electricity, heat, and broadband. |
€3,000 | |
|
Aaron had 200 remote working days. |
€3,000 x 200 | €600,000 |
|
There are 365 days in the relevant year of assessment. |
€600,000 / 365 | €1,643.83 |
|
Aaron’s employer does not offer any remote working allowance. |
0 | |
| Allowable cost (30%) | 30% of €1,643.83 | €493.15 |
| Aaron pays tax at the higher rate – 40% | 40% of €493.15 | €197.26 Tax Relief amount |
Example calculation 2
Brenda worked from home for 150 days. The cost of her electricity, heat, and broadband for 2023 was €1,000. Brenda does not receive an allowance for remote working from her employer.
|
Description |
Calculation |
Amount |
|
Brenda spent an annual total of €1,000 on utility bills for electricity, heat, and broadband |
€1,000 | |
|
Brenda had 150 remote working days |
€1,000 x 150 | €150,000 |
|
There are 365 days in the relevant year of assessment |
€150,000 / 365 | €410.96 |
|
Brenda’s employer does not offer any remote working allowance. |
0 | |
|
Allowable cost (30%) |
30% of €410.96 |
€123.29 |
|
Brenda pays tax at the lower rate – 20% |
20% of €123.29 |
€24.66 Tax Relief amount |
Example calculation 3
Caroline worked from home for 230 days. The cost of her electricity, heat, and broadband for 2023 was €2,000. Caroline received €3.20 per day she worked from home.
|
Description |
Calculation |
Amount |
|
Caroline spent an annual total of €2,000 on utility bills for electricity, heat, and broadband |
€2,000 | |
|
Carline had 230 remote working days |
€2,000 x 230 | €460,000 |
|
There are 365 days in the relevant year of assessment. |
€460,000 / 365 | €1,260.27 |
|
Carolines’ employer pays her €3.20 per day remote working allowance. |
€3.20 x 230 = €736
€1,260.27 – €736 |
€524.27 |
|
Allowable cost (30%) |
30% of €524.27 |
€157.28 |
|
Caroline pays tax at the lower rate – 40% |
40% of €157.28 |
€62.91 Tax Relief amount |
How can we help?
As remote work becomes an integral part of our professional landscape, understanding the financial benefits available is crucial.
Remote Working Relief offers a tangible opportunity for individuals to claim tax relief on essential home office costs.
To ensure you navigate the process seamlessly and maximise your benefits, we are here to help. Whether you’re unsure about eligibility, calculating the eligible amount, or completing the necessary documentation, our experts are here to guide you.
Tom is a Fellow Chartered Certified Accountant (FCCA) and Chartered Tax Advisor (CTA) and is the Head of Accounting at Kinore. Areas of expertise include Accounting, Compliance, Taxation relating to small business and company directors.