Worked From Home This Financial Year?

There are a few different ways you can calculate your deduction for working from home in the 2019/2020 year. You can use the shortcut method (available from 1st March 2020), fixed rate method or actual cost method.

Shortcut Method

The ATO have introduced a shortcut method which will allow people to claim 80 cents per hour for all their running expenses, rather than needing to calculate costs for specific running expenses. This method can be used from 1st March 2020 to 30th June 2020. The shortcut method covers all your working from home expenses such as phone expenses, internet expenses, depreciation on equipment and furniture and electricity and gas expenses. A diary must be kept with records of the number of hours you have worked from home.

Fixed Rate Method

You can claim a deduction of 52 cents per hour you work from home. This method covers all expenses you incur for depreciation on home office furniture and furnishings, electricity and gas expenses and the cost of repairs to your home office equipment, furniture, and furnishings. To claim a deduction using this method you need to record the hours spent at home working and you must have a dedicated work area, such as a home office when you work from home. This method does not include phone expenses, internet expenses, computer consumables, stationery, and depreciation of equipment. To claim the work-related portion of these expenses you must have records on how you calculated your work-use percentage.

Actual Cost Method

Under the actual cost method, you can claim the additional running costs you incur as a result of working from home. These include electricity and gas, depreciation, phone expenses, internet expenses, cleaning (if you have a dedicated area for work) and computer consumables and stationery. To claim a deduction using this method you will need a floor plan of your home so you can work out what percentage of floor place is dedicated to your home office.

Tax Advisers have warned people to carefully consider whether they should opt for the 80 cents per hour method as, while it is simpler and involves less record keeping, it may result in lower deductions.

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