Can an employer arrange a workplace at home for the employee tax free?

Corona work from home

If an employee has to work from home – for example because of the coronavirus – the employer can set up that home workplace tax free if certain criteria are met.

For the workplace at home, reimbursement, benefits or provision within the so called work-related costs scheme (WKR) are subject to a specific exemption for working conditions facilities and a specific exemption for tools, computers, mobile communication equipment and such equipment if they meet the necessity criterion.

A targeted exemption does not come at the expense of the free space of the WKR and only applies if you designate the reimbursement, provision or making available as final levy wages. This will have to be done in the payroll administration.

Working conditions facilities

Occupational health and safety facilities in the workplace at home can be reimbursed, provided or made available by the employer. The targeted exemption applies if:

  • the working conditions facilities are related to the employer’s obligations under the Working Conditions Act;
  • the employee uses the facilities (partly) in the workplace;
  • the employee does not pay a personal contribution for those facilities;
  • the interior of the workplace at home meets the following requirements of the Working Conditions Act:
    – The workplace of a home worker is arranged in such a way that the employee can do his work as much as possible while sitting and in an ergonomically responsible manner.
    – In the workplace there are provisions for efficient artificial lighting.

Examples of facilities that fall under this targeted exemption if they meet the conditions are: an office chair, a table and a desk lamp.

Necessity criterion

The necessity criterion applies if:

  • according to the reasonable opinion of the employer, the provision is necessary for the proper fulfillment of the employment;
  • the employer pays the provision and does not pass the costs on to the employee;
  • the employee must return the provision or repay the residual value of this provision to the employer if he no longer needs it for employment.

“Necessary” means that the employee needs and uses the facility for his work. This includes all forms of tools, computers, mobile communication and similar equipment.

An employee may have a private benefit from the facility. The employer does not have to count this benefit as wages.

Example 1. Internet and telephone

If an employer deems it necessary for his employee to have an internet connection for working from home, he may reimburse this tax-free. The reimbursement then falls under the targeted exemption. The employee’s private benefit is not counted as taxed wages.

Reimbursement of the subscription costs of the fixed telephone at the employee’s home is not covered by the targeted exemption. The targeted exemption only applies to mobile means of communication.

Reimbursement of the subscription costs of a mobile phone does fall under the targeted exemption if it meets the necessity criterion.

Example 2. Internet connection amount

An employer reimburses the costs of the internet at home to his employee. The compensation meets the necessity criterion. The employee has taken out a subscription for a 3-in-1 package (internet, telephone and television) with a provider. What amount is covered by the targeted exemption?

You need to determine which part of the bill is for the internet. You can check what the provider charges for a separate internet subscription. That part falls under the targeted exemption.

If the employer also reimburses the rest, that part is taxed wages.

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