Can I claim home office expenses?
Currently, there are more and more people working from home. As a result, this is a question which is asked frequently. The first rule of claiming a deduction is that you must have paid for the expense. If your employer pays them on your behalf or you are reimbursed, there is no deduction to claim. What you can claim for a home office depends on a number of factors:
|Your home is the principal place of work and you have a dedicated office area||Your home is not the principal place of work and you have a dedicated office area.||You work from home but do not have a dedicated office area|
Depreciation on assets eg. computer
Work related phone and internet costs
Running Expenses – These include
There are 2 ways to calculate the running costs:
Depreciation on Assets – These include but are not limited to computers, printers, office furniture.
If you are claiming home office using the fixed rate of 52 cents per hour, this includes depreciation on basic office furniture. Therefore, there is no additional claim on these. However, you can still claim depreciation on computers and other office equipment.
If not, you can claim a deduction for assets purchased that you use in the home office. You will need to keep receipts to substantiate this claim. In circumstances such as a computer, which is used for both work and personal reasons, you must keep a diary to verify the work use of a computer.
Phone and Internet Costs
There are two ways to calculate your phone and internet costs. They are:
1. Claim up to $50 with limited documentation; or
2. Calculate the actual expenses. – you will need to keep the receipts to substantiate your deduction.
If your deduction is more than $50, you will need to keep records for a four-week period every year, such as a diary to record business use of internet and business calls.
Occupancy Costs – These include
Employees generally cannot claim occupancy expenses. Please note, however, if you claim occupancy expenses, your home will not qualify for the capital gains tax main residence exemption for the area that you work in. Therefore, you may have tax to pay if you sell your home.
For a factsheet provided by the Taxation Office with additional information, please click on the following link: