Small Benefit Exemption and Remote Working Allowance: Tax-Free Employer Payments in Ireland

Irish employers can give staff two kinds of tax-free value that Revenue sets out in plain terms: a small benefit (usually a voucher) under the small benefit exemption, and a daily payment towards the cost of working from home, the remote working daily allowance. Both come with conditions, and both now have to be reported to Revenue. This guide walks through what Revenue's own pages say, so that employers in Dublin and elsewhere can check their practice. It sits alongside our wider guide to benefit in kind for employers in Ireland, which covers the general rules on taxable benefits.

A note on figures: the amounts below are as shown on the Revenue and Citizens Information pages named in each section, on the dates given. Limits and rates can change, so always check the current Revenue page on the day you make a payment.

The short version

• The small benefit exemption lets an employer give a limited number of non-cash benefits in a year without the benefit being taxed. Vouchers are the usual example.
• The remote working daily allowance lets an employer pay a set amount per remote working day, towards costs such as broadband, heating and electricity, without deducting Income Tax, PRSI or USC.
• Employers must report both to Revenue under what Revenue calls the enhanced reporting requirements, and Revenue's remote working page also says records of payments made must be retained.
• Revenue's remote working page says any amount above €3.20 per workday must have tax deducted, and its vouchers page says a taxable voucher is added to pay as notional pay.

Small benefit exemption: what Revenue says

Revenue's page on the small benefit exemption (published 1 January 2025) says that from 1 January 2025 an employer can give up to five small benefits to an employee in a year tax-free, provided their combined value does not exceed €1,500. The page adds several conditions worth noting:

• The benefits must not be in cash.
• If more than five benefits are given in a year, only the first five can qualify.
• Unused allowance cannot be carried over to another year.
• A single benefit of up to €1,500 can be tax-free, but if one benefit is more than €1,500 the full value of that benefit is subject to tax, not just the excess.

The page points readers to Revenue's Tax and Duty Manual for the amounts that applied before 2025, so employers reviewing older payments should use that manual rather than the 2025 figures.

Vouchers

Revenue says the face value of a voucher is generally the value of the benefit. Minor fees or postage on a voucher are disregarded when testing against the threshold, although if the exemption conditions are not met those costs must be included in the value of the benefit. The key condition is that the voucher can only be used to buy goods or services. Where a voucher can be redeemed in full or in part for cash, the page says it does not qualify for the exemption.

Revenue's separate page on vouchers explains the other side of this. Vouchers are taxable benefits unless an exemption applies: the employer must add the value of the benefit, as notional pay, to the employee's pay and deduct Income Tax, PRSI and USC. The page notes that the small benefit exemption may apply when an employer provides vouchers. In other words, the exemption is the route to tax-free treatment, not an automatic outcome of giving a voucher.

Gifts

The Revenue small benefit page we read does not discuss gifts as a separate topic, and it does not say how an employer should treat a gift that falls outside the exemption. Employers who give gifts other than vouchers should read the benefit in kind material on revenue.ie, or take advice, before assuming a gift is tax-free.

Reporting small benefits

The small benefit exemption page says employers must report the date paid and the value of the benefit to Revenue, and refers to Revenue's enhanced reporting requirements guidance. We cover that reporting below.

Remote working daily allowance: what Revenue says

Revenue's page on remote working (published 9 April 2026) says an employer can pay a remote working employee €3.20 per workday without deducting Income Tax, PRSI or USC. The payment is described as covering costs such as broadband, heating and electricity. Revenue sets three conditions: there is an agreement that the employee works from home, the employee carries out substantive duties at home, and the employee does so for substantial periods.

The same page says an employer may repay costs above €3.20 per workday, but any amount above that figure must have tax deducted. Citizens Information (page edited 1 January 2026) adds that employers are not legally obliged to pay the allowance at all. Where an employer does not pay it, the employee may be able to claim tax relief on a portion of their own additional home working costs, and Citizens Information says any employer allowance paid is deducted from what the employee can claim. That is the employee's tax position, so employers should simply be aware that a payment they make can affect what a staff member claims.

Records and equipment

Revenue's remote working page says, under its heading on expenses higher than €3.20 per workday, that records of the payments made must be retained by the employer. It also says employers can provide equipment and facilities for business use, such as a laptop, printer, scanner, work-from-home software, telephone or broadband, and office furniture, and that this is not a benefit in kind where private use by the employee is minimal. Revenue's page deals with the daily payment and with equipment and facilities in separate sections.

Reporting remote working payments

Revenue says employers must report the total number of days worked remotely, the amount paid and the date paid.

Enhanced reporting requirements

Revenue's Tax and Duty Manual on returns by employers in relation to reportable benefits (reviewed September 2026, according to the manual) explains the enhanced reporting requirements. According to the manual:

• The requirement came into operation on 1 January 2024 and applies to three categories: the remote working daily allowance, certain travel and subsistence reimbursements, and the small benefit exemption.
• For the daily allowance the employer reports total remote working days, amount paid and date paid. For the small benefit exemption the employer reports the value of the benefit and the date it was provided.
• Employers must notify Revenue on or before the provision of the benefit or payment. The manual's FAQ states this is a separate reporting requirement from payroll, so these items cannot be sent in the same submission as payroll.
• Three routes are available: direct reporting software, a file upload through ROS, or the online form on ROS.

The manual refers to legislation for the requirement. We have not summarised the legal provisions, and employers should use the manual and Revenue's guidance for the detail of what each report must contain.

How the two fit with the wider benefit in kind rules

Neither relief changes the starting point, which is that benefits given because of employment are generally taxable unless a specific rule says otherwise. Revenue's voucher page shows this clearly: the value is treated as notional pay unless the exemption applies. So the practical test for any benefit is a question in two parts. Does a specific exemption or rule apply? If so, have we met every condition and made the required report? If either answer is no, check with Revenue or your adviser how the value should be treated. Our wider benefit in kind guide, linked at the start of this article, covers how that treatment works more generally.

Remote working is more than a tax question

A daily allowance is one small part of managing remote staff. Remote working raises other questions for employers, such as health and safety, which our guide to working from home health and safety in Ireland explains. Managers of hybrid teams also need to think about availability expectations and the right to disconnect, covered in our guide to leading hybrid and remote teams. The tax treatment in this article is separate from those duties and does not satisfy them.

A practical checklist for payroll and HR teams

Our suggestion: treat the points below as an internal checklist, not as a statement of legal requirements. Revenue's pages remain the authority.

• Write down the remote working arrangement. Revenue's condition refers to an agreement that the employee works from home, so a clear written arrangement helps you show it exists.
• Track days, not just totals. Because the report includes total remote working days, a simple monthly record of days worked remotely per employee makes reporting and later checks easier.
• Count small benefits per employee, per year. The five-benefit and combined-value limits apply per employee, so keep a running list of each benefit, its date and its value.
• Check vouchers before buying in bulk. Confirm that a voucher cannot be exchanged for cash, in whole or in part, before treating it as exempt.
• Diary the reporting. Because reporting is separate from payroll and is due on or before the payment or benefit, build it into the same step as approving the spend.
• Keep the Revenue pages you relied on. Save the page and date you checked when you set the policy, and review it each year.

Questions to put to your adviser

This article is a reading guide, not tax advice. Situations that usually deserve a conversation with your tax adviser or Revenue include benefits that sit close to the €1,500 limit, vouchers with unusual redemption terms, remote working arrangements that vary week to week, and anything involving directors or owner-managers. Revenue's pages are the starting point and your adviser can confirm how they apply to your payroll set-up.

Learnsignal's offices are off Baggot Street in Dublin, and we offer in-person training from there. For current details, see our CPD pages.

Frequently asked questions

Can an employer give cash under the small benefit exemption?

No. Revenue's page says the benefits must not be in cash, and vouchers that can be redeemed in full or in part for cash do not qualify.

Can the small benefit exemption be used more than five times in a year?

Revenue's page says that where more than five benefits are given in a year, only the first five can qualify. The combined value of the five also cannot exceed the limit shown on the page.

Is the remote working daily allowance compulsory?

Citizens Information says employers are not legally obliged to pay it. If an employer does pay it, Revenue sets conditions about the working from home arrangement and requires the employer to keep records and report the payments.

What happens if we pay more than the daily allowance amount?

Revenue's remote working page says any amount above the tax-free daily figure must have tax deducted. The tax-free element is still limited to the daily amount per workday.

Do these payments go through payroll?

Revenue's manual says the enhanced reporting is a separate requirement from payroll and cannot be sent in the same submission as payroll. Amounts that fall outside the reliefs are treated as pay and processed through payroll in the usual way.

Revenue updates its guidance regularly, so review the pages named above whenever your policy changes and at least once a year.