How to make claims for Home Office Deductions - KPG Taxation

Find out the expenses that can be claimed as deductions in case you are working from home.

You must be aware of the rules before claiming the expenses

  • You must have spent the money
  • The expense must be directly related to earning your income
  • You must have a record to prove it

Three Methods to claim for Home Office Expenses

1. Fixed-Rate of 80 cents per hour (COVID-19 Special Shortcut Method).

The 80 cents per hour method covers all of the following running expenses,

  • Electricity for lighting, cooling or heating and running electronic items used for work (for example your computer), and gas heating expenses
  • The decline in value and repair of capital items, such as home office furniture and furnishings
  • Cleaning expenses
  • Your phone and internet costs, including the decline in value of the handset
  • Computer consumables, such as printer ink
  • Stationery
  • The decline in value (Depreciation) of a computer, laptop or similar device.

Please note that we are not allowed to claim other deductions outside the list given by the ATO.

2. Fixed-Rate of 52 cents per hour
This method can be applied even if you don’t have a dedicated Home Office. The advantage of this method is that you can claim other expenses outside the list of 80 cents package. All you have to do is keep records of the timesheet that has the number of hours you have worked from home listed. The only issue is that you have to manually calculate the usage of your phone, internet or any other equipment. Call KPG Taxation experts if you need any help.

3. Actual Running Expenses
This method is preferable if you have a dedicated home office since it required a lot of calculations. You will have to record each and every expense according to the guidelines of ATO. The method is very beneficial but requires professional help to seek maximum benefit. Contact KPG Taxation services to help you with this method.

The Best Method for you

Well, as you can observe, there is a considerable difference between the Home Office Running Expense Deduction between the two fixed-rate methods. It is approximately $190.40 if we assume an average of 8 hours of work per day for 5-day-week. If you are working in this manner, then you should definitely opt for the second option.

The first method is simple but will not give monetary benefits like second. If you are confused about which method to choose, feel free to visit our website or call KPG Taxation services. Contact information is available on the website.

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