The Australian Tax Office (ATO) has made changes to the way in which we can claim working from home expenses. Tax payers can choose one of two methods to claim working from home deductions; either the “fixed rate” or “actual cost” method. Only the fixed rate method is changing.
The revised fixed rate method applies retrospectively from 1 July 2022 and can be used when working out deductions for the 2022-23 tax return.
Firstly, ensure you are eligible to claim working from home expenses. You must be working from home to fulfil your employment duties, not just occasionally checking emails or taking calls, and you must incur additional expenses as a result of working from home.
From 1 July 2022 to 28 February 2023, the ATO will accept a 4 week diary as a representative period to determine hours worked from home. However, from 1 March 2023, tax payers will need to record the total number of hours worked from home.
Revised ‘fixed rate’ method (67 cents per hour)
The revised rate is 67 cents per hour and covers your energy expenses (electricity and gas), phone usage (mobile and home), internet, stationery, and computer consumables. You can separately claim the cost of the decline in value of assets such as computers, repairs, and maintenance for these assets, and if you have a dedicated home office, the cost of cleaning the office.
The revised fixed rate method doesn’t require taxpayers to have a dedicated home office space to claim working from home expenses.
The ‘actual cost’ method
The actual cost method has not changed. You can claim the actual work-related portion of all running expenses. Again, the ATO requires a representative 4 week diary to show how the work-related portion was calculated.
To help keep track of your working from home expenses, we have included this worksheet for your use.
For further information on work from home expenses and claim methods, download this info sheet from the ATO.
