Work-from-home tax break that could be worth just €100 extra a year is branded ‘inadequate’
About 875,000 people have been working remotely, according to figures quoted from Revenue in a Tax Strategy Group (TSG) paper on working from home. Stock image
Moves in the Budget to allow remote workers to claim back more money for their lighting and heating bills have been dismissed as inadequate.
Tánaiste Leo Varadkar is understood to be pressing for those who work from home to be allowed to claim up to 30pc of their annual heating and lighting bills.
The tax break is being considered due to the surge in the numbers working remotely during the pandemic.
Bills for heating and lighting homes are expected to rise by between €500 and €800 this year as a raft of price rises have been announced.
If the Government increases what can be claimed by remote workers for heating and electricity from 10pc to 30pc, it would benefit a higher-rate taxpayer by about €100.
Lower-rate taxpayers could claim an extra €50, according to the consumer tax manager at Taxback.com, Marian Ryan.
But the Irish Congress of Trade Unions (ICTU) said such a move does not go far enough. Its head of social policy and employment affairs, Laura Bambrick, said: “Enhanced tax relief lacks ambition. It does nothing to address the facts that the system is cumbersome to use and causing real hardship for some workers as it is not paid in real time when utility bills fall due.”
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She was referring to the fact that home workers have to wait until the end of the financial year to submit a claim to Revenue.
Remote workers can receive a tax-free payment of €3.20 per day from their employer for home working, or they can have some of their expenses, such as utility costs, reimbursed.
Those working from home who do not get the tax-free payment can currently claim tax relief from Revenue on 10pc of their electricity and heating bills for days they work at home, as well as 30pc of their broadband costs.
The last Budget raised the percentage people can claim for broadband for days worked at home from 10pc to 30pc.
Around 875,000 people have been remote working, according to figures quoted from Revenue in a Tax Strategy Group (TSG) paper on working from home.
The TSG paper says just 90,000 people made a claim for tax relief for working from home as of May this year, with an average amount of €130 per worker.
This works out at just €52 for some on the higher rate of income tax, and just €26 on average for someone on the 20pc rate.
E-workers can claim for remote working only for the days that they are based at home.
People making a claim need to keep copies of bills and expenses as proof of expenditure.
They also need to get written correspondence from their employer to state that they are working from home and are eligible to claim relief.
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