New view of the tax authorities on telework
May 2021 – The tax authorities have set out their views on the tax consequences of teleworking in a circular published at the end of February. While it is true that this circular was issued in the context of the Covid-19 crisis, the new view of the tax authorities applies, regardless of the pandemic, to all teleworking situations as of 1 March 2021.
Telework
The circular deals with both the reimbursement of office expenses, expenses for office furniture, expenses for the use of an internet connection, expenses for the use of a private computer... and the provision of office furniture and/or computer equipment by the employer.
Telework occurs when the worker regularly performs work at home that could also be done on the employer's premises.
In this respect, it is genuine telework carried out on the worker's own premises. Work done in a satellite office of the employer does not constitute telework. On the other hand, it is telework organised in the framework of normal working days. Expenses incurred in order to be able to work at the weekend, for example, do not fall within the scope of telework!
The new view does not apply to company directors.
Reimbursement of expenses
In principle, all allowances paid by an employer to an employee on account of or in connection with the employee's professional activity are taxable as employee remuneration.
The reimbursement of the employer's own expenses is not taxable, but the parties must be able to prove that the compensation is intended to cover the employer's own expenses and that the compensation was actually spent on such expenses.
Fortunately, the tax authorities allow this allowance to be determined on a flat-rate basis for certain types of expenses.
The tax authorities state that the employer may grant a flat-rate office allowance of up to 129.48 euros per month. This is not new. For the months of April, May and June 2021, this amount can (but does not have to) be increased to a maximum of 144.31 euros per month. Up to this maximum amount, the allowance is exempt from tax (and from social security contributions). Above that amount, the part that exceeds it is taxable as remuneration.
The maximum does not have to be reduced in case of part-time work and can also be paid during holidays.
This flat rate office allowance can therefore only be granted in cases of structural and regular telework. This means that the staff member must work from home at least one working day (or equivalent) per week (the assessment is made on a monthly basis). Two half-days of teleworking per week are also allowed, for example. Exceptionally, the scheme can also be used for non-structural telework, for example, if a worker is absent due to illness for a full month.
What expenses are covered?
The allowance covers expenses such as the use of office space in the worker's home (rental, depreciation), computer and printing supplies (not the printer or computer itself, but the paper, a USB stick, a mouse pad, etc.) and office supplies (files, course packs, ballpoint pens, etc.).
The administration also allows that in addition to this allowance, the employer reimburses several other expenses as an employer's own expense or makes equipment available. The circular lists the eligible expenses. These include an office chair, a second computer monitor, a printer/scanner and a keyboard.
These expenses may or may not be repeated annually. The tax authorities consider, for example, that an office chair has a life span of ten years and a second monitor a life span of only three years.
But beware: if the teleworking or professional activity comes to an end and the equipment does not have to be repaid, this results in a benefit of any kind for the employee.
The tax authorities also allow the combination of different fixed telework allowances with additional fixed allowances for specific investments. The employer may, for example, grant, in addition to the above allowances, an allowance:
a maximum of 20 euros per month for the use of a private internet connection and subscription for work purposes; and
a maximum of 20 euros per month for the use of a private computer with peripherals for business purposes, or a maximum of €10 per month for the use of a second personal computer monitor, printer and/or scanner for business purposes, without a private computer.
Please note: the rules for determining the benefit of any kind resulting from the use for personal purposes of a PC, a tablet, an internet connection, a mobile phone or a fixed or mobile telephone subscription made available free of charge remain applicable.
