Working from home is now mainstream, but Revenue's treatment of home-office expenses splits into two very different regimes depending on whether you're an employee or self-employed. Get the framing right and the relief is straightforward. Get it wrong and you might either (a) under-claim by hundreds of euro per year, or (b) accidentally trigger a CGT exposure on your home.
If you're an employee (PAYE) working from home
Two paths:
Path 1: Employer pays the €3.20/day allowance
Revenue's e-Working concession lets employers pay a tax-free flat rate of €3.20 per day for each day worked at home. Five days a week × 47 working weeks (allowing for leave) = ~€750/year tax-free. No receipts, no records beyond a log of WFH days. Employers can pay this without it being BIK.
Path 2: Claim relief via Revenue myAccount
If your employer doesn't pay the flat rate, you can claim tax relief on apportioned home costs through Revenue's myAccount. You get relief at your marginal rate (20% or 40%) on:
- 30% of electricity and heating
- 30% of broadband
Apportioned by days worked from home over 365 (or days in the year you were employed). Practically, an employee at the 40% marginal rate with €2,000 of electricity and broadband working 220 days from home reclaims roughly €145 — modest, but worth it.
If you're self-employed
The rules are different — and more generous, but require more documentation.
You can deduct the business-use proportion of:
- Electricity and heating
- Broadband
- Mortgage interest (not capital)
- Home insurance
- Property tax (LPT)
- Repairs and maintenance attributable to the office area
The two-factor apportionment
Multiply: (business area ÷ total home area) × (business use time ÷ total time).
Example: A 100m² home with a 15m² dedicated office room used 5 days/week.
Area factor: 15/100 = 15%
Time factor: 5/7 = 71.4% (if you also use the room for personal evening use, recalculate)
Combined: 15% × 71.4% = 10.7%
With €4,000 of allowable home costs annually, deductible business expense = €428.
The CGT trap (and how to avoid it)
Principal Private Residence (PPR) relief exempts your main home from CGT on sale. But if part of your home is "used exclusively for business purposes", that portion may lose PPR relief on disposal — meaning a CGT bill on a slice of any gain.
Mitigation: ensure the home office isn't exclusively business. If it doubles as a study, guest bedroom or family room outside business hours, PPR relief continues to apply to the whole property. Document this dual use (a desk in a guest bedroom, for example).
Records to keep
- Diary or log of days worked from home (digital is fine — Outlook calendar exports work)
- Floor plan with the home-office area measured (one-time setup)
- All utility bills, broadband invoices, insurance and mortgage interest statements
- Annual apportionment calculation sheet
- Photos of dual-use evidence (for PPR protection)
Mistakes we see
- Employees claiming "actual costs" instead of using the flat-rate. The flat-rate is usually higher.
- Self-employed using a flat percentage with no documentation. Revenue routinely disallows unsupported apportionment claims.
- Including capital improvements as deductible. Capital costs (a new conservatory used as office) attract capital allowances, not revenue deduction.
- Claiming for periods when not actually working from home. Hybrid workers must apportion accurately.
- Forgetting the CGT angle on property sale. A €50,000 gain on home sale, 10% attributable to home office, taxed at 33% = €1,650 hit you didn't expect.
Working from home and claiming nothing?
We add this to every Form 11 and self-assessment as standard. Most self-employed clients gain €300–€800 of annual tax savings on this alone.
Talk to Us Income Tax Service