TLDR: Remote work allowances are taxable as employment income, but professional expenses incurred can be deducted, choosing between a flat-rate deduction of 10% or actual expenses, provided the latter are justified and strictly work-related.
Taxability of remote work allowances
Remote work allowances are subject to taxation under the general rules for employment income. However, professional expenses incurred for remote work can be deducted, opting between a flat-rate deduction of 10% or actual expenses, provided the latter are justified and strictly related to professional activity.
Deduction of actual expenses
Deducting actual expenses—such as costs for materials, internet connection, or travel between home and workplace—requires submitting documents proving the necessity and amount of the expenses. For travel exceeding 40 km, an explanatory note justifying the distance from the workplace (e.g., family or health constraints) is mandatory.
Income tax declaration
Employees receiving remote work allowances must include them in their tax return under the traitements et salaires (salaries and wages) category. These amounts are taxable like any other salary component, but taxable income can be reduced by deducting professional expenses.
Choosing between flat-rate and actual expense deductions
Taxpayers may choose between a flat-rate deduction (10% of taxable income) or deducting actual expenses. Opting for actual expenses requires retaining and submitting supporting documents (invoices, receipts) proving the reality, necessity, and amount of expenses incurred for remote work.
Travel expenses
Travel expenses between home and workplace are deductible up to the first 40 km without additional justification. Beyond this distance, deductions are allowed only if the distance is justified by objective reasons (e.g., family or health constraints) and compatible with working hours.
Non-deductible expenses
Personal expenses or those justified solely by convenience or cost savings are not deductible. For example, choosing to live in a cheaper but more distant area is not a valid reason to exceed the 40 km limit.
Required documentation
Without supporting documents, expenses cannot be deducted, and any allowances exceeding prescribed limits are considered taxable income. It is important to note that remote work alone does not exempt compliance with general rules on deducting professional expenses.