Reimbursement of home working expenses

This fact sheet is also available in pdf-format.

With effect from 1 January 2022, a new targeted exemption for reimbursement of homeworking expenses will be introduced under payroll tax.

Making new policy

After 31 December 2021, the approval given as part of the corona crisis expires that the fixed travel allowance existing before 13 March 2020 can continue to be paid to employees tax-free, without taking into account a changed travel pattern.

As a result, employers have to make new policies on reimbursing travel and home working expenses from 1 January 2022.

Maximum € 2 per day

The maximum targeted exempt allowance is €2 per day. This amount will be indexed in future years.

The condition is that the employee works from home, within the scope of employment.

Even if only part of a day is worked from home, the entire €2 may be reimbursed tax-free.

Choosing

It is not permissible to pay the employee both the tax-free home working allowance and a tax-free allowance for commuting expenses for the same day.

The employer may then choose which allowance is paid purposefully exempt and which is taxed. Up to a travel distance of 5 km, the reimbursement of home working expenses is higher than the travel allowance (2 * 5 * €0.19 = €1.90).

The taxed allowance may be designated by the employer for the free space of the working expenses scheme. As long as the free space is not exceeded, the allowance is then tax-free. To the extent that the free space is exceeded, the employer pays 80% payroll tax in the form of final levy.

Business travel expenses

However, it is allowed to give the employee a tax-free allowance for the same day, in addition to the tax-free home working allowance, for travel expenses other than those related to commuting.

OV

This also applies when the employer is reimbursed for the actual cost of public transport (OV).

If a public transport chip card or public transport season ticket has been made available to the employee, the targeted exemption for home working expenses can only be applied if the public transport chip card or season ticket was not used to travel to the workplace on the home working day.

Company car/bicycle

Employees with a company car or bicycle or other transport on behalf of the withholding agent may only apply the targeted exemption for homeworking expenses if, on the homeworking day, the car, bicycle or other transport on behalf of the employee was not used to travel to the workplace.

Fixed fee

The starting point is that the tax-free allowance is paid for those days on which work is actually done from home.

But it is also allowed to work with a fixed home working allowance. This may be based on the work pattern agreed by employer and employee. Only when the actual homework pattern deviates significantly from these agreements should the fixed homework allowance be reconsidered.

If the employee works from home on at least 128 days, the fixed home office allowance may be based on 214 working days per calendar year. For an employee who works some days at home and some days in the office, this should be applied pro rata.

Example

An employee works 4 days a week, of which 2 in the office and 2 at home. The one-way travel distance home-work is 20 kilometres.

 Both the fixed travel and home office allowance may be based on 214 working days. But both must be applied pro rata:

• travel costs: (2/5) * (214 * 2 * 20 * €0.19) = € 651 (per month €54.25);
• homeworking costs: (2/5) * (214 * €2) = € 172 (per month €14.33).

What costs?

The following costs are included in the tax-free allowance:

Allowances or benefits in kind under the targeted exemption for occupational health and safety provisions and under the necessity criterion (tools, computers and mobile communication devices) can therefore be made tax-free in addition to the home working allowance.

Cost deduction limitation

The share of the fee for coffee/tea (€0.95) is among the expenses whose deduction is restricted for income and corporate tax purposes. During the parliamentary debate, it was explicitly confirmed that the deduction limitation does not apply to (part of) water consumption.

These costs are deductible:

• in the IB: for 80%;
• in Vpb for 73.5%;

unless the deduction limit is settled based on the lump sums applicable to these schemes.

The purpose of this note is to outline a scheme. For the sake of readability, matters have therefore been simplified. VWG is therefore not liable for the consequences of actions taken or not taken as a result of this memorandum.