Tax Credit for Household Expenses in 2025: What’s Changing?
The household tax credit will undergo several changes in 2025. Here’s a summary.
1. The tax credit decreases to 35% of the cost of work purchased from a company.
When you purchase services from a company registered in the prepayment register, you can claim a deduction of 35% of the labor cost. If you hire an employee, the deduction is 13% of the wages paid to the employee, plus employer’s contributions.
After the household tax credit, Tuttu babysitting services will cost an average of just over €16 per hour in 2025.
2. The maximum deduction is €1,600 per calendar year.
The limit is personal, meaning a household with two adults can claim a total of €3,200 in 2025.
A single-adult household can spend up to €4,500 on services before reaching the maximum deduction. In a two-adult household, services worth up to €9,000 can be used – which could provide approximately 350 hours of babysitting from us!
3. The deductible rises to €150 per year.
Before you can benefit from the deduction, you must pay an annual personal deductible of €150, up from the previous €100.
When will the changes take effect?
These changes took effect on January 1, 2025.
How can you utilize the household tax credit for work done in 2025?
There are two ways to take advantage of the household tax credit:
-
Immediate benefit: Order a new tax card for the current year and enjoy a lower tax rate right away.
-
Post-claim: If you prefer to handle things last-minute, you can wait until early 2026 to claim the credit on your tax return. File your claim in the spring, and you’ll receive your money back as a tax refund.
Digital-savvy taxpayers can do this in MyTax, while the more traditional among us can use form 14A. If you’re a Tuttu customer, we’ll send you instructions for filling out your tax return via email.
When can I claim a household tax credit for babysitting?
To claim a tax deduction for babysitting, the care must take place at the family’s home or vacation home. However, care can begin, for example, with picking up the child from daycare, and outings to the park or swimming pool are allowed.
Tax credit eligibility does not extend to private lessons or other educational services conducted at home. However, if tutoring or language immersion is part of the babysitting service, you can still utilize the household tax credit.
Can I claim a household tax credit for babysitting if I receive other support?
You can claim a tax deduction for babysitting during parental leave, even if you receive partial or flexible childcare allowance.
If you receive private childcare support for daycare fees, you can still claim a deduction for babysitting done outside daycare hours.
However, parents on home care allowance cannot claim a deduction for babysitting during daytime hours, as the same work would otherwise receive two types of support.
Where can I find babysitting services eligible for the household tax credit?
Fill out the form at the link below, and let us suggest experienced, interviewed babysitters who are the perfect fit for your family!
