With the rise of remote work, many Australians are now working from the comfort of their homes. While this offers flexibility and convenience, it also brings about a new set of expenses. Understanding how to claim these expenses can significantly impact your tax return. In this post, we’ll delve into the intricacies of working from home expenses and how you can claim them.
1. Eligibility Criteria
To claim working from home expenses, you must:
- Be working from home to fulfil your employment duties, not just carrying out minimal tasks like occasionally checking emails or taking calls.
- Incur additional running expenses as a result of working from home.
- Have records that show you incur these expenses1.
2. The Shortcut Method
The ATO has introduced the shortcut method, which is a simplified way to claim all home office expenses. For instance, if you worked at home for 35 hours a week for 15 weeks of the year, the calculation would look like: 35 hours x $0.80 x 15 = $4202. However, it’s essential to note that the ATO has reduced its blanket shortcut method for claiming household running expenses from 80 cents per hour to 67 cents per hour3.
3. Deduction Changes for 2022-23
For the period from 1 March 2023 to 30 June 2023, you’ll need a record of the total number of hours you worked from home (e.g., a timesheet, roster, or diary) and evidence that you paid for each of the expenses incurred that are covered by the fixed rate method, such as a phone or electricity bill4.
4. Additional Claims
The recent revisions to the work-from-home rules allow for additional claims for equipment and other expenses, as revealed in the ATO’s latest guidance.
5. Detailed Breakdown: Working from Home Expenses
For a comprehensive understanding of working from home expenses, we’ve attached a detailed sheet that provides an in-depth breakdown of all the potential costs you might incur and how to claim them. This sheet is a valuable resource for anyone looking to navigate the complexities of home office deductions.
Download the Attachment: Working from Home Expenses Guide
Conclusion
Working from home has its perks, but it’s crucial to be aware of the expenses you can claim to maximise your tax benefits. Always consult with a professional accountant or tax advisor to ensure you’re making the most of your deductions.
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