Tax Deductions For People Working From Home

Frances Sievers

April 8, 2020

Are you one of the many people across Australia who has had to change from working on a site or central office to now work from your own home?  If so, there are tax deductions available to you for the cost of your home office running expenses. 

What do I have to start doing now? 

We strongly recommend that you: 

What deductions were available before 1 March? 

Before 1 March 2020 the Tax Office allowed a fixed rate method and required people working from home: 

What deductions are available now? 

From 1 March 2020 the Tax Office now: 

What does the alternative shortcut method of $0.80/hour cover? 

The shortcut method rate covers all deductible running expenses, including:  

Which method should I use

This will depend on the amount of your actual running expenses and whether you have kept your receipts for phone, internet, stationery etc.  The fixed rate method also requires you to calculate the work related portion of phone, internet and related computer/laptop costs.  This would require you to keep a log of your use over a 4 week period to enable a portion for work use to be calculated and used for the full period you worked from home. 

If your employer is paying for most items such as your phone costs, computer costs, internet etc, the shortcut method does not require you to actually incur these costs and therefore may be the better method. 

Your accountant will be able to calculate the best method for you.  However, you need to ensure you have kept your records.   

What records do I need to keep? 

To use the shortcut method you need to keep a record of the hours you worked at home.  This could be timesheets or diary notes. 

To use the direct method: 

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