Household tax credit 2024

Articles on housing, plumbing repairs, energy, renovation and single-family homes, produced by Hausoturva.

Household tax credit 2024

Articles on housing, plumbing repairs, energy, renovation and single-family homes, produced by Hausoturva.

The household allowance is a tax-deductible expense allowance that you can claim and receive when you buy various services for your home or holiday home. The household allowance is not granted automatically, so each household must always apply for the allowance on its own initiative. In this article, we’ll tell you a bit more about the household allowance, how it works, where to claim it and what changes 2024 brings for the household allowance.

Where can you get the household allowance?

You can get a household allowance for, among other things, the following work and services:

  • Renovations and renovations
  • Home cleaning outsourced
  • Gardening, tree felling, ploughing, snow ploughing outsourcing
  • Household chores, such as outsourced cooking
  • Air source heat pump installation and maintenance
  • Renovation of the heating system, for example switching from oil heating to other heating systems
  • Various care services, such as elderly care and childcare services
  • IT installation and consultancy services

In a nutshell, you can claim the household allowance for various types of household work, either in your own home or in your holiday home. You can also get a household allowance for work done in your own parents’ or grandparents’ home. The most typical services covered by the household allowance are renovations and renovation work, such as kitchen, bathroom and roof renovations. In addition, common household chores covered by the household allowance include house cleaning, lawn mowing and snow work.

You can also claim a household allowance for care work for children and the elderly. This is one of the latest additions to the household allowance, which came into force in 2022. The household deductions for care work will continue to apply at increased rates in 2024.

However, you cannot claim a household allowance for all domestic work in your home or holiday home. Here is a list of some household chores that are not eligible for the household allowance:

  • Condition inspections, such as taking pictures of pipes
  • Measurements and surveys, such as mould and humidity measurements
  • Chimney sweeping (excluding chimney or flue repair, which is eligible for the household allowance)
  • Extension works, for example the construction of an additional wing
  • New construction, such as building a new garage

If you are not quite sure which services related to your home or leisure home qualify for the household allowance, you can find a comprehensive list of different types of work on the Tax Administration’s website, which will indicate whether or not the work in question is covered by the household allowance.

Where and how to apply for the household allowance?

As we mentioned at the beginning, the household allowance is not automatically granted for tax purposes, but each household must apply for it itself. The household deduction is reported in the tax return either online via Omavito or by post, for example on Form 14A under “household deduction for compensation paid to a business”. To do this, you should keep a record of all the work you have done, the remuneration you have received and other incidental expenses, such as travel expenses. Once the expenses have been declared on the tax return, the tax authorities deduct them directly from the tax.

A household allowance can also be claimed to reduce the withholding percentage for the current year. To apply for this, you need to order a change tax card. If you order an amendment tax card, please note that the expenses that qualify for the deduction should usually be added to the tax card for the year in which the expenses were incurred. So you cannot add expenses from 2023 to your 2024 tax card and vice versa.

Expenses are considered to have been incurred in the year in which the remuneration, salary and incidental salary expenses are paid. Thus, wages paid in January 2024 for work done in late December 2023 will be declared for tax purposes in 2024. If you are not sure to which year the expenses should be added, we recommend that you contact the Tax Administration’s customer service to check the information.

Temporary increases in the household tax credit will continue in 2024

During 2024, the maximum amount of the household deduction and the percentage of these expenses that can be deducted will be extended from 2022 and 2023. The increase does not apply to all services covered by the household allowance, but to household, care or nursing work.

The normal maximum household allowance is €2 250 per person, but in 2024 the maximum amount of household, care and nursing work per person will be €3 500. The percentage of costs to be deducted is normally 40% for compensation for work and 15% for wages, but in 2024 the corresponding percentages for domestic, care and nursing work will be 60% and 30% respectively. You can also apply for an increased household allowance for giving up oil heating.

Household tax credit for married couples

When claiming the household allowance, keep in mind that in the case of a married couple, the household allowance will be paid as claimed by both partners. This way, you should only claim the household allowance for one of the parties, for example if you do not exceed the limit of €3 500. This way, only one of the parties pays the deductible for the deduction.

If the amount claimed as a deduction exceeds the maximum amount, the taxpayer will automatically deduct this part from the tax of the other spouse. This means that spouses can receive a maximum deduction of €7,000 for household, care and maintenance work and €4,500 for other expenses qualifying for the household allowance. However, the household allowance cannot be deducted in the tax of a person who does not pay taxes, so if only one party has income and therefore taxes, the household allowance only applies to that party’s tax.

Household tax credit and other subsidies

Also bear in mind that receiving other benefits may affect your eligibility for the household allowance. For example, the household allowance cannot be granted if the following subsidies have been received for the same work or service:

  • Support for family carers
  • Support for childcare at home
  • Private care support
  • Service voucher
  • Wage subsidies
  • Energy support
  • Any other aid granted from State, municipal or other public funds

It is worth noting that the above-mentioned subsidies and service vouchers do not in any way prevent you from receiving the household allowance in full, as their use prevents you from claiming the household allowance only for the work or service for which you received the subsidy. Thus, for example, support for childcare at home does not prevent you from receiving a household allowance for, say, snow work or wood chopping at the same time. You will also not be eligible for an increased household allowance if you switch from oil heating to district heating if you receive energy subsidies from the state.

Electricity rebate and electricity subsidy will not be extended in 2024

The electricity rebate and electricity subsidy paid during 2023 will not be extended to 2024. This is because these reductions and subsidies were intended to compensate for the costs of the increase in electricity prices caused by the energy crisis. As it seems that the energy crisis has started to ease and the price of electricity seems to be relatively stable, at least for the moment, both the electricity tax credit and the electricity subsidy from Kela have been abolished.

Remember these things when you apply for the household allowance in 2024!

Although it is relatively easy to apply for the household allowance, there are a few important things to bear in mind when applying for the household allowance.

When you are planning to order work or services and thus claim the household allowance, keep the following points in mind:

  • When you order services from a company and you plan to deduct these expenses for tax purposes, always check first that the company in question is registered in the prepayment register, otherwise you will not be able to claim the household allowance.
  • Since the household allowance does not apply to new construction, you cannot claim the household allowance for building a new garage, for example, but you can claim it for renovating an old garage. Also, the extension of an existing building is not covered by the household allowance, which means that you cannot claim the household allowance for building a new room, for example, even if it is attached to an “old” building.
  • Canopies (excluding light canopies) built in the yard of an old house are also not eligible for the household allowance.
  • You can only claim the household allowance for the work portion, for example, various brokerage fees and service charges are not covered by the household allowance.
  • Members living in the same household can claim more than one household allowance for the same work, provided that the work was carried out with their own resources, so that, for example, minor children are not usually eligible for the household allowance.
  • Check that the invoices have the correct details and that they are in the name of the person who paid for the work, i.e. you – if someone else’s name is on the invoice, you will not be eligible for the household allowance.

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