Last updated: 8  Jun 2024

Enjoy the benefits of working from home arrangements? fabulous, and now we're approaching June tax time you're wondering what you can claim in your tax return.

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If you weren't wondering, glad I've got your attention - read on below.

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Firstly, to claim WFH expenses you need to:

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-be working from home to meet your employment duties; and

-incur additional expenses as a result of working from home.

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You no longer need to have a dedicated home office to claim! woo hoo

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You can choose one of two methods to claim working from home deductions:

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1.      Revised Fixed rate

2.     Actual Cost

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Revised Fixed Rate Method

You can claim this rate is you WFH and keep records of the time you work, to prove you incurred the costs.

A fixed hourly rate of 67 cents is what you can claim as a total deductible expense and covers:

- electricity and gas;

- phone usage (mobile and home) and internet;

- stationery; and

- computer consumables.

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For example: if you work from home 2 days per week from 9am –5pm, your claim would look like this:

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7 hours (taking an hr for lunch) X $0.67 = $4.69 per day;

or $9.38 per week for your 2 days a week.

Over a year (assuming a 48 week year), this looks like: $450 total.

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Seems a bit low to me, and there was no explanation for how the ATO arrived at a rate of $0.67. But, that's what it is.

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Items that still can be claimed separately and additionally to the above rate include:

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·      decline in value of assets used (known as depreciation) while working from home, such as computers, laptops and office furniture,

·      repairs and maintenance of these assets and

·      costs associated with cleaning (only if you have a dedicated home office).

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Record keeping

• You need to keep a record of all the hours worked from home for the entire income year – the ATO won’t accept estimates.
• Records of hours worked from home can be in any form provided they are kept as they occur, for example, timesheets, rosters, logs of time spent accessing     employer or business systems, or a diary for the full year.
• Records must also be kept for each expense taxpayers have paid which is covered by the fixed rate per hour (for example, if taxpayers use their phone and     electricity when working from home, they must keep one bill for each of these expenses).

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Actual cost method

This method needs more detailed paperwork kept and calculations made, but may be worth calculating if you can claim a higher amount.

To use the actual cost method to claim actual expenses, you must (again):

• incur additional running expenses as a result of working from home; and
• keep all records or other written evidence, which shows the amount:    

1. you spend on the following expenses:

data and internet, mobile phone, heating, cooling and lighting, computer consumables and stationery and cleaning expenses if you have a dedicated office

2. you spend on depreciating assets (computer, laptop) you buy and use while working from home

3. work-related use for your expenses and depreciating assets (those that lose value due to wear-and-tear).

You can’t claim running expenses if other people living in your house (who are not working from home) are in the same room as you while you are working from home.

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How it works

Using the actual costs method, you work out your deduction by calculating the actual additional expenses you incur when working from home.

This includes expenses you incur for:

• the decline in value of depreciating assets – for example, home office furniture (desk, chair) and furnishings, phones and computers, laptops or similar devices.
• electricity & gas (energy expenses) for heating, cooling & lighting
• home and mobile phone, data and internet expenses
• stationery and computer consumables, such as printer ink and paper
• cleaning your dedicated home office.

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Where you incur running expenses for both private and work purposes, you need to apportion your deduction. You can only claim the work-related portion as a deduction.

For example, your internet charges are $70 per month (or $840 pa) and your work-related use is 70%, then you can claim $588.

The ATO has a helpful calculator to assist you work out what your claimable work from home expenses are.  

You can find it here (or search ATO home deductions calculator) if the link breaks:

‍calculatorsandtools | Australian Taxation Office

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In order to be able to make any tax deductions on expenses incurred when working from home it’s crucial that you keep accurate records.

Carefully consider (and calculate) which method you are eligible to use and is going to give you the best tax outcome, before making your claim. If you need assistance with this, reach out to a tax professional. I know many fabulous female accountants, so please reach out to me if you need some recommendations.

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Source: ATO website

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