Did you know you can claim working from home expenses? For FY2024, please contact us using one of the methods below.
If you have been working from home due to change of working arrangement , you may have expenses you can claim as a deduction this tax time.
There are twoways you can choose to work out your deduction for working from home.
Fixed rate method ─ if you have a dedicated work area (like a home office), you can use this method to claim
- A rate of 52 cents per work hour for electricity and/or gas for heating, cooling, lighting and running items used for work, cleaning expenses and the decline in value of office furniture
- The work-related portion of your phone and internet expenses, computer consumables, stationery
- The work-related portion of the decline in value of equipment (such as mobile phone, computer, laptop or similar device)
Actual cost method ─ claim the actual work-related portion of all your running expenses, which you need to calculate on a reasonable basis.
- Electricity expenses associated with heating, cooling and lighting the area from which you are working and running items you are using for work
- Cleaning costs for a dedicated work area
- Phone and internet expenses
- Computer consumables (for example, printer paper and ink) and stationery
- Home office equipment, including computers, printers, phones, furniture and furnishings – you can claim either the
- Full cost of items up to $300
- Decline in value (depreciation) for items over $300.
Using the actual expenses method, you work out your deduction from actual costs you incur as a result of working from home.
If you don’t have a dedicated work area, such as a home office, you will generally only incur minimal additional running expenses.
For example, if the area you use for work is a common area of the home such as a lounge room and that area is being used by other members of your household for another purpose (such as, family members watching television) at the same time you’re working, you won’t be incurring any additional costs for lighting, heating or cooling as a result of working in that room.
To work out the work-related portion of your actual expenses you must have records. You can either keep:
- A record of the number of actual hours you work from home during the income year
- A diary for a representative four-week period to show your usual pattern of working at home
- Work out the decline in value of depreciating assets and
- Keep receipts showing the amount you spent on the assets
- Show the percentage of the year you used those depreciating assets exclusively for work – you can claim for the portion of the decline in value that reflects your work-related use of the depreciating assets
- Work out the cost of your cleaning expenses (if you have a dedicated work area) – for example, a room set up as a home office, by adding together your receipts and multiplying it by the floor area of your dedicated work area (floor area of the dedicated work area divided by the whole area of the house as a percentage) – your claim should be apportioned for any
- Private use of your home office
- Use of the home office by other family members
- Work out the cost of your heating, cooling and lighting by working out the following
- The cost per unit of power used – refer to your utility bill for this information
- The average units used per hour – this is the power consumption per kilowatt hour for each appliance, equipment or light used
- The total annual hours used for work-related purposes – refer to your record of hours worked or your diary for this information
- Work out the cost of your phone or internet plan expenses – where you receive an itemised bill, you need to determine your percentage of work use over a four-week representative period.
- Work out the cost of computer consumables and stationery by keeping receipts for the items purchased.
- To claim a deduction for an asset that cost $300 or more, you need to calculate the decline in value for both the period you:
- Owned the assets during the income year
- Used the assets for work-related purposes.
You can use the depreciation and capital allowances tool to calculate your deduction for the decline in value of equipment, furniture and furnishings that cost more than $300, use the depreciation and capital allowances tool to work this out.
Expenses you can’t claim
If you are working from home, you can’t claim:
- The cost of coffee, tea, milk and other general household items your employer may otherwise have provided for you at work
- Costs related to children and their education, including setting them up for online learning, teaching them at home or buying equipment such as ipads and desks
- Time spent not working, such as time spent home schooling your children or your lunch breaks.
Please take note employees generally can’t claim occupancy expenses, such as rent, mortgage interest, water and rates.
To claim working from home expenses during this tax return period
- You must have spent the money
- The expense must be directly related to earning your income
- You must have a record to prove it.
What if you receive an allowance from your employer to cover your expense when you work from home?
If so,
- You must include this allowance as income in your tax return
- You can claim a deduction for the expenses you incur.
What about work-related expenses like car and travel claims?
Find our more about work-related expenses like car and travel claims here.