If the home office was already a trend, in 2020 it became the rule. Due to the pandemic, many workers started to work remotely and, consequently, spend more time at home, which leads to an increase in expenses with electricity, heating and internet, for example.
With that in mind, the Irish government is offering rebates on income tax to anyone who worked remotely during the pandemic. The amount is not high, but it already helps in difficult times like this. There are two ways to obtain the benefit:
1) The company pays a maximum contribution of € 3.20 per day to employees, without any tax. In this case, the payment must be negotiated directly with the company.
2) The worker requests, at the end of the year, the return of part of the expenses as a credit in the income tax. The maximum request limit is 10% of expenses with electricity and heating, and 30% of expenses with internet, proportional to the number of days worked.
For example: in a period of 6 months, you worked 130 days and took 60 days off. During the entire period, you spent € 800 of electricity, which equates to € 5 per day. If we multiply this amount by the working days, the expense is € 650. Therefore, you can ask for a rebate of 10% of this amount, ie € 65. Then the amount you will get back will depend on the tax rate you pay. If you pay the highest rate, 40%, you will have a credit of € 26 (€ 65 x 40% = € 26). If you pay the lowest rate, 20%, the return will be € 13 (€ 65 x 20% = € 13).
Yes, the calculation is complicated, and some people will question whether it is worth all the effort for the almost insignificant value. But, if you are willing to go through with the process, just follow these steps:
- Register your myAccount on the Revenue website, the Irish IRS;
- Search for the option Review your tax and select the corresponding year;
- After filling in the personal data on the form, look for the Tax Credits and Reliefs < / em> (on page 4);
- Within the Your job tab, fill in the amount you want to claim in Other PAYE Expenses .
Remember to calculate the amount proportional to working days, not counting weekends. You will only be able to claim credit for 10% of electricity and heating costs, and 30% of internet costs.
It is also recommended to keep a copy of all accounts, and have a letter from the company saying that you worked from home at that time, if the recipe requires proof.