Working From Home Tax Deductions

The Australian Taxation Office (ATO) released its final guidance on claiming deductions for additional running expenses when working from home, starting from July 1, 2022. The ATO’s revised fixed-rate method allows taxpayers to calculate their deductions for expenses incurred while working from home. It applies to running expenses, such as electricity, internet, phone, and depreciation, but not to occupancy expenses like mortgage interest or rent. Prior to July 1, 2022, taxpayers had the choice of using the shortcut method or the fixed-rate method of 52 cents per hour. The revised fixed-rate method, which applies from July 1, 2022, allows a deduction rate of 67 cents per hour for specific expenses that are difficult to divide. The ATO’s compliance approach supports the revised fixed-rate method, but taxpayers can also claim actual expenses. It is essential to keep records of hours worked and the incurred expenses to support the deductions.

For more information, speak with your Simmons Livingstone advisor on 1800 618 800 or via email at admin@simmonslivingstone.com.au.