Freelancer tax break on rental homes to go

Files on ShelfTax minister Eric Wiebes is closing a loophole which allowed freelancers living in rental houses to deduct their entire rent from tax.

The Supreme Court ruled in June that freelancers could consider all their rent a legitimate business expense, so long as they used at least 10% of their home as an office.

Currently, fewer than 1% of freelancers take advantage of the tax break, costing the treasury €20m, Wiebes said. However, this could rise to €500m, the minister said.

By scrapping the break on rental homes, Wiebes has equalised the situation between home owners and people living in rented property. Both may now only deduct the cost of a home office from tax if it functions as an independent unit, with its own door and other provisions.

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