Working from home as an employee – what can I claim?

Times are changing from day to day, are you one the fortunate people who are able to continue in employment and work from home?

Times are changing from day to day, are you one the fortunate people who are able to continue in employment and work from home? This is a new concept for many out there and we thought it timely to outline work related expenses you will be able to claim during this period. The ATO has also come onboard and will accept a temporary simplified method (or shortcut method) of calculating additional running expenses from 1 March until at least 30 June 2020 – the ATO may extend this period.

Running Expenses

Employees who work from home can claim the work-related proportion of their running expenses. These expenses are the cost of using equipment and utilities at your home for work and include:

  • Lighting
  • Heating and cooling
  • Cleaning
  • The decline in value of equipment, furniture and furnishings in the area you sue for work
  • The cost of repairs to this equipment, furniture and furnishings, and
  • Other running expenses including computer consumables (such as printer paper and ink) and stationery.
Occupancy Expenses

As an employee, generally you can’t claim a deduction for occupancy expenses, which included rent, mortgage interest, property insurance, land taxes and rates. This is an area that we strongly suggest you seek advice from your accountant on as every individual situation is different.

Phone and Internet Expenses

If you use your phone or internet for work, you can claim a deduction for the work-related percentage of your expenses if you paid for these costs and have records to support your claims.

  • You need to keep (records) for a four week representative period in each income year to claim a deduction of more than $50.
  • These records included phone bills (paper or electronic) from which you can identify work-related calls.
  • Diary entries and evidence that your employer expects you to work at home or make some work-related calls will also help you demonstrate that you are entitled to a deduction.
Records You Must Keep

You must keep records of your expenses, such as:

  • Receipts or other written evidence, including for depreciating assets you have purchased
  • Diary entries to record your small expense ($10 or less) totally nor more than $200, or expenses you cannot get any kind of evidence for
  • Itemised phone accounts from which you can identify work-related calls, or other records such as diary entries, if you do not get an itemised bill, and
  • Diary entries of your hours spent working at home to help you demonstrate that you are entitled to a deduction.
Temporary Shortcut Method 1 March to 30 June 2020

You can claim a deduction of 80 cents for each hour you work from home due to COVID-19, as long as you are:

  • Working from home to fulfil your employment duties and not just carrying out minimal tasks as occasionally checking emails or taking calls.
  • Incurring additional deductible running expenes as a result of working from home.
  • You do not have a separate or dedicated area of your homeset aside for working, such as a private study.

A record must be kept of the number of hours you have worked from home as a result of COVID-19. The shortcut method rate covers all running expenses that you may incur as a result of working from home during COVID-19, including:

  • 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 costs, including the decline in value of the handset
  • your internet costs
  • computer consumables, such as printer ink
  • stationery
  • the decline in value of a computer, laptop or similar device.

The big takeaway from this is keep all your receipts, accurate diary entries when you work and seek written clarification of your working from home expectations from your employer.


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