22 March 2020
By Elaine Murphy
elaine@TheCork.ie
- Employees Now Working From Home Urged to Claim Tax Relief
- Thousands of people across the country should avail of e-worker refund
Thousands of workers throughout the country who have recently been asked to work from home as a result of COVID-19 can avail of Revenue’s e-worker relief. Tax refund specialists at Taxback.com say that many of these employees will never have worked from home before, and so will be completely unaware of the relief that is available to them.
Joanna Murphy, CEO of Taxback.com explained the situation,
“Thankfully, technology has meant that people all over the country have been able to go home & continue their work from there. It is a difficult time for everyone and households throughout the country are already feeling the financial impact of this. If there are any supports available to people, it’s important that they are made aware.
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. Now these provisions can apply to the new wave of e-worker also.
Taxback.com say 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”. By working from home over the coming weeks & possibly months people will incur some additional costs that they may not even be aware of.
Ms. Murphy, went on to comment,
“The obvious ones are heating, electricity and perhaps broadband expenses. 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.
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.”
Who qualifies?
The experts at Taxback.com say that home workers and e-workers who work from home on a full or part-time basis can qualify for this relief.
Ms. Murphy advised,
“E-working is characterised by working for substantial amounts of time outside your normal place of work, logging onto a work computer remotely, communicating remotely, or indeed developing ideas, products and services remotely. Simply calculate your total costs and the amount of your time (as a percentage) you spent working from home. You can then claim the tax break on this percentage of the cost”.
How do I claim work from home expenses*?
Taxback.com advise workers that if their employer isn’t reimbursing them, they will need proof of costs incurred (relevant bills) to claim tax relief.
The employee must keep receipts for any expenses made as well as detailed record of business vs private use.
The eWorking scheme only applies to eWorker employees. It does not apply to workers who bring work home outside of normal working hours.