Coworking Spaces and Tax: What Business Owners Need to Know

Many business owners and self-employed people are now choosing coworking spaces as their base. For some, the novelty of working from home has worn off; for others, coworking offers a more affordable alternative to taking on a full office lease. Whatever the reason coworking spaces, such as WeWork, Iconic Offices and Huckletree are popping up in cities and towns across Ireland. 

 

Why Choose a Coworking Space? 

Traditionally, most people in desk-based roles worked from an office or other business premises. Working from home was once reserved for a lucky few but from 2020 the daily commute suddenly became a walk to the spare room. More recently, the office has made a comeback, whether by employee choice or through company policies requiring staff to attend on certain days. Co-working spaces have now also entered the mix, offering businesses an alternative to home working and the traditional office. 

 

Traditional Office vs Work From Home vs Coworking Space 

 

Traditional Office 

There are many reasons that businesses would choose a traditional office workspace: 

• More privacy and confidentiality that is needed in some professions
• More control over your environment and how you set things up.
• Having teams together can make informal communication, training and supervision easier. 
• Some businesses depend on having a permanent address and reception area as they meet and host clients. 

But one of the main reasons businesses are moving away from the traditional office are the higher costs associated with them. The cost of furniture, equipment, fit-out, utility bills, insurance, cleaning, maintenance all add up. 

 

Work From Home 

Working from home seemed to eliminate this cost entirely for businesses. There were also no commutes and a better work-life balance for business owners and their staff. However, working from home created its own challenges: 

• While on the surface working from home offered a better work life balance it in fact meant people were isolated and spending hours alone every day. When working from home there is limited interaction with colleagues and reduced networking opportunities. For many people, the lack of daily interaction began to affect their mental wellbeing. 
• Working from home does not always provide the ideal setting for client meetings, business owners may find themselves conducting meetings over coffee or hiring a room for the occasion. 
• Working from home is also technology dependent. Poor broadband or power outages can cause issues for business owners.  

 

Coworking Space 

In recent years coworking spaces have grown in popularity as people searched for a middle ground between costly traditional offices and the isolation of working from home. 

Coworking spaces offer: 

• Lower costs and shorter commitment for businesses than renting their own premises. 
• A coworking space creates a more professional image than working from home and offers a space to meet with clients.  
• It tackles the issue of isolation as a shared workplace can provide social interaction and a sense of community.  
• It also creates a better work-life separation which people are finding just as important as work-life balance.  

 

Tax & Coworking Spaces 

So, you’ve chosen coworking over the kitchen table, but how does Revenue view the cost? 

With a traditional office any costs that are “wholly and exclusively for the purposes of the trade” are tax deductible. This can include rent, rates, light, heat, electricity, cleaning and repairs, business broadband and phone lines.  

The same principle applies to coworking expenses. Whether you rent a hot desk, a dedicated desk or a private office in a coworking space, the cost may be deductible if it is incurred wholly and exclusively for business purposes.

When you work from home you may be able to claim tax relief on the additional costs this brings, including electricity, heat and broadband. You work out how much of the expenditure was for business purposes and claim a deduction for that amount only. This rule also applies to a coworking space used for both business and personal purposes. Only the costs associated with the business portion could be claimed.  

 

What Expenses Might I Have When I Use a Coworking Space: 

There are a number of different expenses that are associated with using a coworking space that may be tax deductible: 

• Licence fees 
• Meeting-room hire 
• Printing and copying 
• Telephone services 
• Registered-office or business-address services 
• Storage 

 

What you can’t claim as an expense (includes the following): 

• While the rental cost of renting a room to meet a client is a business expense, client entertainment cannot be claimed. 
• If the coworking space is your usual workplace then the cost of your commute will not be deductible. 
• Your own office clothes (only protective clothing are tax deductible)  
• Your own equipment like laptops and monitors (these would be classed as capital expenditure) 

 

How can I claim a tax deduction for coworking expenses: 

 

Limited Companies: 

When a limited company pays for a coworking space, any qualifying business expense is deducted when calculating the company’s taxable profits, which are reported to Revenue on its CT1 corporation tax return. 

Sole Traders: 

Sole-traders, freelancers, contractors and self-employed people will claim coworking space expenses when they file their Form 11 tax return. 

Whether you operate through a limited company or as a sole trader remember to keep receipts and invoices for all co-working costs, as Revenue may request them. 

 

Coworking Spaces and VAT 

If your business is VAT registered and your coworking space provider is VAT registered you may be able to claim back the VAT paid. However, the VAT position is not always straightforward, so professional advice is recommended. 

 

Coworking Spaces and Employers 

Where an employer provides a co-working space solely for an employee to carry out their duties, the cost is generally a business expense and should not give rise to a taxable Benefit in Kind (BIK). 

However, if an employee decides that they want to use a coworking space this is viewed as their own personal choice and they cannot claim tax relief on it themselves.  

 

How We Can Help

Whether you work from home, a traditional office or a coworking space, TaxAssist Accountants can help you understand which business expenses may be allowable. We support sole traders and limited companies with their tax returns, expense claims and Revenue obligations, leaving you free to focus on running your business. 

 

 

 

Last updated: 2nd September 2026