Remote Work — How to Account for Home Office Costs

Remote work has become a permanent part of Polish labour law. Since 2023, the Labour Code contains detailed provisions governing remote work, including employer obligations to cover costs. At the same time, entrepreneurs running a sole proprietorship (JDG) or working on a B2B basis can deduct part of their home expenses as business costs. This guide explains the rules from both perspectives.

Remote Work on an Employment Contract — Employer Obligations

What Must the Employer Provide?

Under Art. 67²⁴ of the Labour Code, the employer is obliged to:

  1. Provide work materials and tools — computer, monitor, keyboard, mouse, headset
  2. Provide installation, servicing, and maintenance of work tools
  3. Cover electricity costs related to remote work
  4. Cover telecommunication costs (internet) necessary for work
  5. Cover other costs directly related to remote work, if specified in an agreement or internal regulations

Flat-Rate Remote Work Allowance

The employer may cover remote work costs through a flat-rate allowance (ryczalt) instead of reimbursing actual expenses. The allowance should correspond to the estimated costs borne by the employee.

Key tax benefit: The remote work allowance is exempt from PIT and ZUS contributions (Art. 21(1)(13) of the PIT Act). This means:

  • The employee receives the full allowance amount net
  • The employer does not withhold ZUS contributions or PIT advance payments
  • The allowance is a tax-deductible cost for the employer

How to Determine the Allowance Amount?

The regulations do not specify a set amount — the employer determines it independently, considering:

| Cost Component | Example Calculation | |---------------|-------------------| | Electricity | Device consumption x price per kWh x working hours | | Internet | Subscription cost x proportion of business use | | Water, heating | Proportional to time worked at home | | Use of personal equipment (if applicable) | Market depreciation rate |

A typical allowance in practice is PLN 100–300 per month for a full-time remote position. The amount must be justified — an excessively high allowance may be questioned by ZUS or the tax office.

Equipment Equivalent

If the employee uses their own equipment (e.g., a personal laptop), the employer pays a monetary equivalent. The equivalent is also exempt from PIT and ZUS, provided it corresponds to the market cost of using the equipment.

Documentation

The employer should have:

  • Remote work agreement or internal regulations — specifying the rules, work location, and how costs are covered
  • Allowance calculation — documented assumptions behind the amount
  • Employee declaration — confirming remote work conditions (e.g., having an appropriate workstation)

Remote Work on B2B / Sole Proprietorship — Home Office Costs

If you run a sole proprietorship and work from home, you can include part of your home expenses as tax-deductible business costs. The principle is simple: costs must be related to the business and documented.

Space Proportion

The basic method is the space proportion — the ratio of your home office area to the total area of your flat or house.

Example: Your flat is 60 m², and the office occupies 12 m². The proportion is 12/60 = 20%. You can deduct 20% of your housing costs as business expenses.

What Can You Deduct?

| Expense | How to Deduct | |---------|--------------| | Rent | Proportional to office space | | Internet | In full (if essential for work) or proportionally | | Electricity | Proportional to office space | | Heating | Proportional to office space | | Office furniture (desk, chair, shelf) | In full — directly related to work | | Computer equipment | In full (depreciation or one-off up to PLN 10,000) | | Office supplies (paper, toner, pens) | In full | | Phone | Proportional to business use | | Home insurance | Proportional to office space |

Rented vs Owned Property

  • Rented — rent is deductible in proportion to office space. You need the rental agreement and invoices/bills.
  • Owned — you cannot deduct mortgage instalments (that is repayment of a liability, not a cost), but you can deduct mortgage interest proportionally, along with utility fees and bills.
  • Spouse's property — you can deduct costs if you have permission to use the space and you document the expenses.

Property Depreciation

If you own the flat and use part of it for business, you can depreciate that portion. The depreciation rate for residential premises is 1.5% per year of the initial value attributable to the office portion.

Hybrid Work

With hybrid work (partly in the office, partly from home), the accounting rules do not change, but:

  • Employee allowance — should be proportional to the number of remote work days (e.g., 3 remote days out of 5 = 60% of the full allowance)
  • JDG costs — you deduct for the months/days you actually work from home

Comparison: Employment vs B2B — Remote Work Costs

| Aspect | Employee (employment contract) | Entrepreneur (B2B/JDG) | |--------|-------------------------------|----------------------| | Who covers costs | Employer (obligation) | The entrepreneur | | Form | Flat-rate allowance or reimbursement | Tax-deductible business costs | | PIT exemption | Yes (for the allowance) | N/A — costs reduce the tax base | | ZUS exemption | Yes (for the allowance) | N/A | | Documentation | Regulations + calculation | Invoices + space proportion |

For more on the differences between employment and B2B, see Employment Contract vs B2B.

Common Mistakes

  1. No allowance calculation — the employer pays a "round number" without justification, which may undermine the PIT/ZUS exemption
  2. Inflated space proportion — claiming 50% of a studio flat as office space raises questions
  3. No remote work agreement — without formal arrangements, the allowance may be treated as employee income
  4. Double deduction — deducting the same expense in a JDG while also receiving an employer allowance
  5. Missing invoices — costs must be documented (internet invoices, electricity bills)

Summary

Remote work offers concrete tax benefits — both for employers (allowance exempt from PIT/ZUS) and for B2B entrepreneurs (home office cost deductions). The key is proper documentation and a reasonable cost proportion.

Need help with remote work cost accounting? The accounting firm LinTax Wrocław will help you set up the allowance correctly or account for home office expenses in your sole proprietorship.