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Flexible Work Practices

Dáil Éireann Debate, Thursday - 16 June 2022

Thursday, 16 June 2022

Questions (13)

Alan Dillon

Question:

13. Deputy Alan Dillon asked the Minister for Finance if he will support future changes to the current tax arrangements to reinforce support for remote working given the Government’s policy to facilitate same; and if he will make a statement on the matter. [31359/22]

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Written answers

The Programme for Government includes a commitment to facilitate and support remote working. The National Remote Work Strategy aims to make remote work a permanent feature of the Irish working experience in a way that maximises the economic, social and environmental benefits.

As part of the national remote working strategy: Making Remote Work, in 2021 the Tax Strategy Group (TSG) reviewed the tax arrangements for remote working in respect of both employees and employers. The TSG paper outlines the effects of Covid-19 on remote working in Ireland, provides an international comparison of remote working tax rules, sets out options for consideration with regard to enhancing the tax arrangements for both employers and employees in respect of remote work and evaluates those options in accordance with the Department of Finance Tax Expenditure Guidelines. The paper is published on the gov.ie website.

The TSG paper noted that changes to the tax arrangements for remote working may give rise to issues of deadweight loss and economic inefficiencies, as well as equity issues in the personal income tax system. The paper also noted that in the context of a whole of Government policy to facilitate and support remote working, it may be considered appropriate to enhance or amend the current tax arrangements in order to underline and reinforce public policy decisions in this area.

Taking these factors into consideration, as the Deputy will be aware, in the Finance Act 2021, were enhanced and formalised the tax arrangements for working from home in line with Government policy to facilitate and support remote working. Accordingly, for the tax year 2022, an income tax deduction amounting to 30% of the cost of vouched expenses for electricity, heat and broadband in respect of those days spent working from home can be claimed by taxpayers.

The amount of the relief will depend on the particular circumstances of the remote worker in terms of the level of costs incurred and their marginal tax rate. However, this measure provides some relief for those with additional expenses arising from working from home, and at the same time it ensures that the traditional burden of employer related costs are not transferred from the employer to the State and the wider body of taxpayers.

There are no immediate plans to further increase the tax relief for working from home.

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