Working from home tax relief explained

When employees are asked to work from home, their expenses are likely to increase due to additional use of things including electricity, heating, telephone and internet. If you work from home (also called remote working), or did during the pandemic, you may be eligible for some tax relief. In this article, you’ll learn what working from home tax relief is, if you’re eligible and how you can claim it.

Working from home tax relief is offered to employees who are asked to work from home by their employers.

You can claim relief on costs at the following rates:

• For 2024, you can claim the tax relief during the year or after the end of the year. If you claim during the year, you can get real-time credits. This means that you can claim for expenses when you pay them and get increased tax credits in your subsequent payroll payments from your employer
• From 2022, 30% for electricity, heating and internet costs
• For 2020 and 2021, 30% for internet costs and 10% for electricity and heating costs

To be eligible for tax relief, you must be carrying out your work at home. This means you must be able to show that your home is your workplace. Irish Tax & Customs will accept that your home is a workplace if you are performing substantive duties from your home, and these duties must be related to your current work. These include:

• Working for substantial periods at home
• Logging on to a work computer system remotely
• Sending and receiving email, data or files remotely
• Developing ideas, products and services remotely

You won’t be able to claim working from home tax relief if you work outside of your home, for example if you’re visiting clients, and then just complete some tasks at home.

You can only claim expenses that are in direct relation to remote working. These include the electricity, heating and broadband you use during your working hours.

There are two ways you can claim when working from home.

1. Your employer pays you up to €3.20 a day as an allowance towards your working from home expenses. This allowance is free from tax, PRSI and USC. If your employer pays more than €3.20 per day to cover expenses, you will pay tax, PRSI and USC as normal on the amount above €3.20.
2. Should your employer choose not to cover your extra expenses, you can claim tax relief at the end of the financial year (1st January to 31st December). This calculation is made by apportioning the number of days in the year that you worked from home and multiplying that figure by 30%.

Note that if you share these types of expenses with someone else, the amount you can receive in tax relief is based on your share of the bill rather than the whole bill. You can only claim for the days that you were working from your home in your normal working hours.

For 2023, to calculate the amount of costs you can get tax relief on for your electricity, heating and internet costs:

1. Add your electricity, heating and internet costs and multiply the total costs by the number of days worked at home
2. Divide by 365
3. Multiply by 30% (0.3)

When you have the figure, you can calculate your tax savings – you will get tax relief on the amount of your costs at a rate of 20% or 40% (whichever is the rate of income tax you pay).

If you normally file a self-assessment tax return, you can make a claim there. Alternatively, you can claim working from home tax relief using Irish Tax & Revenue’s myAccount service.

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