Tax breaks for working from home to be boosted under new plan

Taoiseach Leo Varadkar says the pandemic and the shift to remote working has changed attitudes for many employees. File picture

Greater tax breaks for people working from home will form a major part of October’s budget, as part of a bid to promote remote working.

Under the plan, announced on Friday by Tánaiste Leo Varadkar, employees will be given a legal right to request permission to work from home and an onus will be placed on employers to explain why such a move is not possible.

The plan includes a promise to legislate to provide employees the right to request remote working, to introduce a legally admissible code of practice on the right to disconnect from work, and to invest in remote work hubs, ensuring they are in locations that suit commuters and are close to childcare facilities.

Update from me on our plans to make remote working a real choice for more people, after the pandemic👇 pic.twitter.com/qZW8NyPgJk

— Leo Varadkar (@LeoVaradkar) January 15, 2021

Also included in the plan is the commitment to allow 20% of public sector employees to work remotely as well as a vague commitment to “explore the acceleration of the National Broadband Plan”.

Mr Varadkar said he would seek to review the treatment of remote working for the purposes of tax and expenditure in the next budget.

“We're also going to have a package in Budget 2022, that's the budget in October, to improve the tax treatment and expenses regime around home and remote working,” he said.

At the moment, a worker can receive a tax repayment of €3.20 a day from their employer for home working, or they can have some of their expenses, such as utility costs, reimbursed.

It's intended that, as part of the budget package in October, there'll be a new package of tax incentives and expenses to encourage people to work from home. 

You'll see an improvements there on what's currently in place, and the Tax Strategy Group and others will work on that but it will form part of the budget package in October,” Mr Varadkar said.

He said during the pandemic we've learned that remote working and home working is actually much easier than we thought. 

“There are hundreds of thousands of people now working from home for almost for a year now. And when the pandemic ends, and it will end, we want to make the choice to work from home, the choice to work remotely easier,” Mr Varadkar said.

“It also means blended working, which is what a lot of people want to be able to do, maybe a few days in HQ, but also a few days at home, or working from remote [hubs] in a town or village. In terms of benefits, we think it can be a real positive in terms of work-life balance."

Sinn Féin spokesperson on enterprise Louise O’Reilly welcomed the publication of the Making Remote Work strategy, and called on Government to support opposition legislation, currently in train, which would deliver on some of the goals of the strategy.

Sinn Féin spokesperson on Enterprise, Trade, Employment and Workers’ Rights @loreillysf has welcomed the publication of the Making Remote Work strategy but called on government to support opposition legislation which would deliver on some of its goals.https://t.co/K8ptzKlK7B pic.twitter.com/0wEqutGDnO

— Sinn Féin (@sinnfeinireland) January 15, 2021

Ibec, the business lobby group, said the proposal was a timely recognition of the accelerating changes in our workplaces.

Maeve McElwee, Ibec director of employer relations, said: “There has been an increasing trend towards more flexible and remote working in recent years and this pace of change has been vastly accelerated by Covid-19. 

"We are pleased to see Government commitments to invest in necessary infrastructure such as remote working hubs, alignment with childcare facilities, and the National Broadband Plan, as well as reviewing tax arrangements to incentivise remote working.”