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Working from home? You might qualify for tax relief

20 Mar 20201.01k Views

According to Taxback.com, many people working from home are not aware of the relief schemes available to them.

Employees in Ireland who have recently been told to work from home because of the coronavirus outbreak may be able to claim tax relief under Revenue’s e-worker scheme.

According to tax refund firm Taxback.com, people hoping to be reimbursed for work-related expenses while working from home should keep proof of costs, such as receipts and a detailed record of business versus private use.

The company’s CEO, Joanna Murphy, estimated that before coronavirus reached Ireland, there were more than 100,000 people working from home who could benefit from Revenue reimbursements.

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“Now these provisions can apply to the new wave of e-worker also,” she said. “This is a benefit that, in our experience, is already heavily under-utilised. But now more than ever, people are going to need all the financial support they can get.”

Murphy added that by working from home, employees may spend additional money on items that they aren’t aware of. These include heating, electricity and broadband.

“From a tax perspective, 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,” she said.

“But even if your employer 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.”

Both full and part-time home workers and e-workers can qualify for the relief.

Lisa Ardill
By Lisa Ardill

Lisa joined the team as senior Careers reporter in July 2019 with previous experience in science communication and media. With a BA in neuroscience and a master’s degree in science communication, she is also a semi-published poet and a big fan of doggos.

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