Can you claim?
In order to be able to claim a deduction for working at home, all of the following must apply:
- You must have spent the money on the expense you’re claiming
- The expense must be directly related to earning your income
- You must have a record to prove it.
Note: You cannot claim a deduction for items provided by your employer or if you have been reimbursed.
If you receive an allowance from your employer to cover your expenses for working from home, you:
- Must include the allowance as income on your tax return
- Can claim a deduction following the rules in this blog or on the ATO website.
Expenses you can claim
These expenses stay the same as before. To find out what they are, read our previous blog on tax benefits from working at home here.
Expenses you can’t claim
These expenses now have the following addition:
- You cannot claim the cost of coffee, tea, milk and other general household items your employer may otherwise have provided you with at work.
Calculating running expenses
In addition to the ‘ATO rate per hour’ and ‘diary and running expenses’ methods, the ATO has now also introduced a new ‘shortcut’ method to calculate your running expenses. Read more about the other two methods here.
Shortcut method
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 (this does not include just carrying out minimal tasks such as checking emails or taking calls)
- Incurring additional deductible running expenses as a result of working from home (for example electricity, cleaning costs and stationery).
Note: You no longer need to have a separate or dedicated area of your home set aside for working to be able to claim.
General notes on this method
- The shortcut method rate covers all deductible running expenses
- If you use the shortcut method to claim a deduction for your additional running expenses, you cannot claim a further deduction for any of the expenses
- If you use the shortcut method, you must include the note ‘COVID-hourly rate’ in your tax return
- You must keep a record (timesheet, diary notes, rosters) of the hours worked from home as a result of COVID-19.
These rules are in place from March 1 - June 30, and may be extended depending on when work patterns start to return to normal. This means that any expenses made before March 1 cannot be claimed as per the shortcut method.
We hope this new method makes claiming your expenses easier. If you do have any confusion, questions or are uncertain about any other Government initiatives, don’t hesitate to contact your local ITP Qld consultant. We’re here - available via ‘live chat’, phone or email.