As many questions on the possible financial contributions that employers may make to the various home office costs incurred by their employees remained unanswered in the Circular of 14 July 2020 (see our newsflash of 17 July 2020 in this respect), a new Circular (2021/C/20) was published by the Federal Public Service for Finance on 26 February 2021. Note that this Circular applies beyond the COVID-19 pandemic. Its content was discussed with the social security authorities aligning the tax and social security treatment.
In a nutshell
The new Circular covers the following costs:
The lump-sum reimbursement for the home office cost and, separately, the employer’s compensation covering the cost of office furniture and IT material. Alternatively, the scenario where the employer puts the office furniture and IT material at the disposal of the employee is also covered.
The cost of the professional use of private equipment like:
- a personal internet connection;
- a personal computer;
- personal IT material in combination with a computer provided by the employer.
Home office cost and cost of office furniture and IT material
- 1.1. An employer can grant his employees who structurally and regularly perform a substantial part of their working hours at home a fixed office allowance of maximum EUR 129.48 per month. The Belgian government has decided to increase the maximum amount of EUR 129.48 per month for the months of April, May and June 2021 (= Q2 2021) to a maximum amount of EUR 144.31 per month (see our newsflash of 17 February 2021 in this respect).
- 1.2. This allowance covers the following costs (non-limitative list): use of office space at the employee’s home (including rent and any depreciation of office space), printer and computer equipment (this does not mean the printer and computer themselves, but for example paper, a USB stick, a mouse pad and ink), office supplies (folders, course pads, pens etc.), utilities such as water, electricity and heating, as well as maintenance, insurance, property tax, coffee, water and refreshments.
- 1.3. Working from home on a structural and regular basis means the equivalent of one working day per week (e.g. one full working day per week, two half working days per week or several days of a few hours work performed during normal working hours). This is assessed on a monthly basis.
- 1.4. Contrary to what was provided in the Circular of 14 July 2020, the employer may, provided that certain conditions are met, differentiate the office allowance on the basis of the category of staff or the actual circumstances in which the home work is organised.
- 1.5. If the conditions for structural homeworking are not met, the lump-sum office allowance does not apply (i.e. not even a percentage of it).
Office furniture and IT material
- 1.6. In addition, and on top of the above-mentioned amount, the employer can bear a part of the employee’s financed purchase of office furniture (e.g. a desk, chair, desk or desk lamp) and computer material (a second computer screen, a printer/scanner, keyboard, mouse, foot mouse, trackpad, trackball and/or headphone set, as well as specific equipment needed by disabled persons to work smoothly with the computer). The tax administration accepts that reimbursements made (in this case on top of the lump-sum office allowance of EUR 129.48) for such office furniture/computer equipment (limitative list) are considered reimbursements of costs proper to the employer. These reimbursements do not need to be deducted from the lump-sum office allowance, provided that they are based on actual supporting documents and relate to investments that are necessary to be able to carry out the professional activity at home in a normal way (luxury items that exceed the professional needs will not be accepted). The expenses related to the furniture listed above can be reimbursed in a one-shot payment or spread over time. Specific modalities are foreseen (e.g. what if the employee leaves, or what is the minimum useful life of the material?).
- 1.7. The above concerns the situation where the employee purchases the equipment himself, and thus is the owner of the equipment and therefore asks for a reimbursement of these costs. Alternatively, the tax administration agrees that the employer may make such material available to employees without charging them a taxable benefit in kind for it. The fact that the employer makes this material available to his employees does not impact the amount of the fixed sum. After all, the lump sum constitutes reimbursement of other expenses.
Lump-sum reimbursement for professional use of private equipment
Personal internet connection
- 1.8. If the internet connection is actually used by the employee for homeworking, the employer’s contribution to the professional use of a private internet connection and internet subscription may be determined on a lump-sum basis of EUR 20 per month.
- 1.9. If a private computer is actually used by the employee in the framework of homeworking, the employer’s contribution to the professional use of a personal computer may be fixed at a flat rate of up to EUR 20 per month. This refers to all types of computer equipment, i.e. desktops, laptops and tablets, as well as accessories and software necessary to perform homework. In other words, in addition to the monthly allowance of maximum EUR 20 for the professional use of the private computer, no additional allowance can be granted for the professional use of personal accessories.
Personal IT material in combination with a professional PC
- 1.10. If only a second computer screen and/or a printer/scanner belonging to the employee (restrictive list) are used for the professional activity (the computer is provided by the employer), the lump sum of EUR 20 for the use of a private computer does not apply. In this case, an allowance of EUR 5 per month per item (so an absolute limit of maximum EUR 10 per month) can be granted for a maximum of 3 years.
Other points to note
- 1.11. The new Circular applies to employees and civil servants. Self-employed company directors, splitters and expats falling within the scope of Circular Ci RH 624/325.294 of 8 August 1983 are outside the scope of the new Circular.
- 1.12. The new Circular is without prejudice to Circular 2017/C/82 of 13 December 2017 on the lump-sum valuation of the benefit in kind related to the personal use of a computer provided free of charge (EUR 6.00 per month), internet connection (EUR 5 per month), telephone subscription (EUR 4 per month) and tablet/smartphone (EUR 3 per month).
- 1.13. The lump-sum allowances that are a reimbursement of the employer’s expenses must be justified by the individual salary slip. On individual fiche no. 281.10 (income 2020), next to section b) of box 27 ‘miscellaneous information’, ‘YES – serious standards’ must be indicated. In view of the importance of the non-taxable reimbursement of the employer’s expenses in the context of homeworking, from income year 2022 onwards, the exact amount of the allowances will always have to be indicated in the “miscellaneous information” section of fiche no. 281.10, in addition to the information already requested.
- 1.14. For the purpose of legal certainty, the employer can always submit a request for a ruling on this matter to the Dienst Voorafgaande beslissingen / Services des Décisions Anticipées. This is in any case recommended if, in addition to the costs related to the home office, other items are also reimbursed.
- 1.15. The Circular of 26 February 2021 is applicable from 1 March 2021, with the understanding that the tax administration will take into account the principles set down in it for homeworking situations that occurred on or after 1 January 2020. Finally, note that this Circular does not affect any current rulings.
How can PwC help you?
Your PwC contact, together with the PwC expert matter team is available to discuss the impact and the conditions of this Circular on your expense and homeworking policy.