Making Cents: Employees have tax incentive to work from home

Making Cents: Employees have tax incentive to work from home

The number of people working from home appears to be on the rise in Ireland and this is good for the environment. 

If you are looking at ways to live more sustainably, you should consider looking into your employer’s “work from home” policy, or suggesting they put one in place.

At the time of the most recent census, in 2016, the CSO reported approximately 94,955 persons working “mainly at or from home”, an increase of 11,629 on the 2011 figures. 

Even if the number merely continued to rise at the same rate it has gone over 100,000 by now, and the likelihood is, the rate is increasing.

So why is a working life spent in the home a more sustainable one?

The most obvious reason is that there is no commute. You may think in terms of avoiding the time and stress of sitting in traffic. 

But by not using any fuel, either on public transport or in your own vehicle, you are also reducing your carbon footprint. 

Even if you go in once a week, or as needed for meetings, you are still helping the planet by not adding to traffic on a daily basis.

There are other environmental benefits, particularly in reducing the scourge of single-use plastics. 

If you are in the habit of grabbing a sandwich or salad from the deli counter, both the earth and your wallet will thank you for switching to making lunch in your own kitchen instead. 

Doubly so, if you are also a fan of takeaway coffee. Even if you are organised and bring lunch with you, it is hard to avoid extra waste when out of the house, from cling film on food, to paper towels in office bathrooms.

Companies are also likely to see economic and environmental benefits to employees staying at home, from reduced printing to less rubbish accumulating.

The good news, if you are considering working from home, is that there is also a tax incentive to do so. 

“One of the lesser known benefits of remote working can come in the form of a valuable tax break on the cost of additional home heating, electricity and broadband use,” says Eileen Devereux, commercial director at

Taxback.com

“We process hundreds of tax refunds for people in Ireland every day and the number of people who apply for this credit is very small. 

"So based on our own experience, we believe most who work from home are simply not aware that they can claim this tax benefit.”

Costs employees claim back include heating, electricity and in some cases internet expenses. 

Depending on your employer’s preference, they can cover up to €3.20 per day or they can leave it to you to claim it back.

Making Cents: Employees have tax incentive to work from home

With 253 working days in 2019, that means an employee could receive €800 a year tax free, which means there will be no deduction of PAYE, PRSI or USC from that amount.

Your employer may choose not to do this but if so, you can claim tax back on them. 

It is important to note 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 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 the utilities are for both personal and work use and benefit everyone in the home, so the refund received will be based on only a portion of the overall expenses. 

You must submit receipts to your local Revenue office using MyEnquiries — available through MyAccount at revenue.ie.

Ms Devereux said: “The world’s leading tech companies have laid the groundwork for a different kind of approach, and many smaller companies are now adopting these methods. 

"We’re seeing people in all kinds of sectors working from home. It doesn’t matter if you’re in HR, advertising or accounting, in many cases, all you need is a computer with internet access.”

Aside from sustainability and financial benefits there are more to consider, from a shorter day without your commute to simple things like being able to pop on a wash or preparing meals during work breaks. 

Good for your wallet, for the planet and for the household — there are plenty of positives.

Deal of the week

Making Cents: Employees have tax incentive to work from home

If you are tired of paying for a TV package you don’t use enough, it may be time to take another look at Saorview.

RTÉ describes the service as the future of free TV with no contract and no monthly bills and new features make it more attractive to viewers.

Saorview Connect has just released a new recording function.

The package includes benefits such as catch-up TV and Spotlight, which gives you all the best daily recommendations.

The new recording function allows customers to pause and record live TV plus series link their favourite programmes.

To access the service you need a Saorview Connect box.

Linking it to an existing or new satellite dish will allow you to access extra free international and UK channels in addition to the Irish channels.

The box can be bought in a number of retailers and costs about €160.

You can judge if that is good value against what you pay each month.

After intital setup, Saorview will be free.

www.saorview.ie

If there are any consumer issues that you’d like Gráinne to address or if you have problems that Gráinne could help with, she can be contacted at makingcents@examiner.ie

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