89% say remote working has increased household expenses

Remote workers are also worried that their new work set up could affect the CGT relief they would receive on the sale of their home

86% believe remote working will remain a dominant feature of their working arrangements to some degree into late 2021

Almost nine in ten Irish workers who are working from home say their household expenses have or will increase as a result of remote working necessitated by the coronavirus pandemic.

The vast majority (86%) also believe that remote working will remain a dominant feature of their working arrangements to some degree into late 2021.

The findings come from a new survey by Taxback.com which was carried out on the back of Budget 2021, which the tax refund experts say held no substantive changes to the financial supports for these workers.

Of those surveyed, just over half said their household expenses have or will increase “a little” due to remote working, with 37% saying their household expenses have or will increase “a lot” due to home working.

Marian Ryan, Consumer Tax Manager at Taxback.com said working from home can call for some additional expenditure and often employers do not cover, or are not in position to cover, those costs.

“The additional cost of household utilities, particularly home heating as we come into winter, is a burden for workers. Being at home more means using more electricity and oil or gas, and for many it might mean having to upgrade to better broadband," she said.  

Consumer Tax Manager Marian Ryan believes a new Flat Rate Expense relief should be introduced. 

“Many people will have found themselves working at their kitchen table over the last few months – a scenario that’s perhaps not sustainable or advisable as this temporary work measure becomes more long-term or permanent. Workers may have to invest in proper office desks or chairs and while some employers might offer an allowance for this, others will not.”

“All of these costs mount, and while there is a tax relief available for e-workers to help them offset some of these costs, it is very little in the context of what workers have to spend.” 

The government announced the formation of a committee to strategize for the future of e-working in this years Budget, but Ms Ryan said they didn’t do enough to increase supports for e-workers, “bar the modest inclusion of broadcast costs in the reliefs already in place.” 

"We are calling for this committee to consider our proposal for the introduction of a new Flat Rate Expense relief which could see workers anywhere from €160 to €300+ better off,” she said.

“Currently, from a tax perspective, an employer can pay €3.20 a day to their employee to cover the additional costs incurred by working from home. While this payment is tax free, which means employers won’t be deducting PAYE, PRSI or USC from it, it isn’t mandatory and many businesses, who are already cutting budgets to stay afloat, are not in a position to pay this additional amount.”

CGT Relief

Taxback.com, which provides specialist tax return services to private and corporate clients, has also been fielding concerns from hundreds of e-workers since April, who are worried that their new work set up could ultimately affect the Capital Gains Tax (CGT) relief they would receive on the sale of their home.

“Lots of people are worried that because they now have what might be considered a “home office”, they would no longer be eligible for the Principal Private Residence tax relief if they were to sell their home at any point in the future,” Ms Ryan said.

She was eager to confirm that "this is absolutely not the case.”

Ms Ryan said the purpose of the survey was to ascertain where people see themselves working into next year and how this impacts them financially.

“The results are clear – the vast majority of workers believe home working will be an aspect of life for them, to varying degrees, in 2021, and any confidence of a full return to work scenario is relatively low.”

“In many ways, the results underpin the uncertainty that lies at the heart of this pandemic – people are simply living and working on a day to day basis in many cases – waiting to see what the next twist in the tale will be."

"In light of this we really need to make sure we look after the financial and mental welfare of our new remote workforce,” she finished.