If you worked from home during the 2020-2021 income year, you might be wondering what you’re entitled to claim for on your tax return. The ATO is cracking down on fraudulent claims this financial year, so if you’re planning to claim for laundry costs on work uniforms you haven’t worn—think again! Unless of course you want to find yourself the subject of a tax audit. And no one really wants that!
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Not sure what you can deduct for working from home? We’ve compiled a list of some of the things you can claim for. This is by no means an extensive list.
Home office expenses
The shortcut method
For every hour you have spent working from home during 2020-2021, you can claim 80 cents. This is known as the shortcut method. It’s the easiest method to use and all you need to do is provide proof of the hours you have worked and a 4-week time journal. It won’t provide you with the best tax refund but if you’ve been lax in keeping records, it’s certainly the quickest and simplest way to go. Keep in mind, you won’t be able to claim separately for electricity, phone, internet, cleaning costs or depreciation of office furnishings because it’s covered by the shortcut method.
For example: If you purchase an office desk, under the shortcut method you cannot claim for it.
The hours you have spent caring for children or providing homeschooling are not deductible.
The fixed-rate method
If you’re looking for a better tax refund, you may want to calculate your deductions based on the fixed rate method of 52 cents for each hour worked from home. You can separately calculate phone, electricity and internet, as well as office consumables, stationery and depreciation of office equipment—phones, iPads and laptops.
If you are using the fixed rate method to calculate your deductions, you must also provide records of the hours you worked from home during the financial year. You will need a spreadsheet or journal detailing a 4-week period to provide insight into your typical working patterns each week.
Actual costs
You’ll need to have kept well-documented records and receipts, if you want to claim on the incurred costs from working from home. Keep in mind that you are not able to claim on items that you’ve been reimbursed or compensated for by your employer. Items such as coffee, tea, milk and meal allowances are not included when you work from home.
Office cleaning costs
A clean office area is conducive to being more productive. If you get a cleaner to wash windows, vacuum, or provide cleaning supplies, you can claim the office-related portion. You will need to provide receipts.
Continued Professional Development
If you have undertaken self-education that results in a formal qualification you may be eligible to claim back a portion of the course fees, textbooks and stationery. The course must be related to your current career path. For example; If you are a marketing assistant and you undertake a Bachelor of Dog Psychology, this will not be covered. However if you were undertaking a communications degree, then you can claim this.
Depreciation of office furnishings, phone and computers
If you purchased an asset costing more than $300, you will be able to claim the decline in value for assets you own and used during the financial year for work purposes.
Heating, cooling and lighting
You are entitled to work in a comfortable environment, therefore you will be eligible to claim on the work-related portion of what it costs to heat, cool and light your office area.
Phone and Internet
Keep records of the work-related phone and internet for work because you can deduct the cost for calls to colleagues and clients.
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