Maximise Your Tax Return: Work-from-Home Deductions Explained
Written by Shara Cox & Anna Colley
With flexible work arrangements now part of everyday life, many Australians are working from home either full-time or part-time. But when it comes to tax time, knowing what you can, and can’t, claim can be confusing.
The Australian Taxation Office (ATO) has clear rules on how to calculate work-from-home deductions, and understanding them can make a real difference to your tax return.
Eligibility to Claim Work-from-Home Expenses
To claim work-from-home deductions, you must:
Be working from home to fulfil your employment duties (not just occasionally checking emails).
Incur additional running expenses as a result of working from home
Two ATO-Approved Methods for Claiming Deductions
1. Fixed Rate Method
Claim 70 cents per hour worked from home. This rate covers:
home and mobile internet or data expenses
mobile and home phone usage expenses
electricity and gas (energy expenses) for heating, cooling and lighting
stationery and computer consumables, such as printer ink and paper.
Record-keeping required:
Maintain a diary, timesheet, or work log showing hours worked from home.
2. Actual Cost Method
Claim the actual work-related portion of expenses such as:
Electricity and internet bills
Office furniture depreciation
Technology purchases
Record-keeping required:
Detailed receipts and calculations showing how you determined the work-related percentage of each expense.
What You Can’t Claim
Unless your home is classified as a place of business, you generally cannot claim:
Rent or mortgage interest
Council rates
Home insurance
Common Mistakes to Avoid
Using outdated methods (e.g., the 80 cents shortcut method is no longer available).
Failing to keep accurate records.
Claiming personal expenses as work-related.
Record-Keeping Tips:
Use a digital diary or spreadsheet to track hours.
Keep all receipts and bills.
Note the work-related use of shared expenses (e.g., internet).
How Salt Financial Group Can Help
Work-from-home deductions aren’t always straightforward. At Salt Financial Group, our accountants can help you:
Choose the most beneficial method for your situation
Ensure compliance with ATO rules
Maximise your eligible deductions
Ready to Get Expert Advice?
Contact Salt Financial Group today for tailored tax advice that helps you make the most of your work-from-home setup, while staying compliant and stress-free.