What does working from home due to COVID19 mean for your Tax Return?
If you're an employee and working from home due has become your 'new normal' post-pandemic, you may be enjoying the benefits of staying in your PJ bottoms all day or squeezing in an extra load of washing between Zooms…You may also be able to enjoy some benefits from the ATO (click here for fact sheet).
You need to be careful with what and how you claim as the ATO does keep an eye on this fairly closely. It’s easy to mistakenly claim something that’s not included or simply not forget to record substantiating evidence for your claims. For example, if you are working in the dining room you can only claim the hours of use where you exclusively used that room for work!
We spoke to Moneywise Global for their best advice on what and how to claim expenses relating to Working From Home.
WHO IS MONEYWISE?
A subsidiary of Flight Centre Travel Group, Moneywise Global was created specifically for SME companies to support their employees in setting and achieving their personal financial goals. It’s such an important aspect to life and happiness, yet so often neglected as we work from day-to-day, and pay-to-pay. So, at your service, your people can have financial advisers and educators, home loan specialists and taxation experts who really understand how important it is to have financial resilience.
KEEP A RECORD
Make sure you keep records to show these expenses and how you have calculated your claim. We recommend that you keep a log for everyday that you do work from home as a mode of substantiation.
HERE ARE SOME OF THE THINGS YOU CAN CLAIM
- Occupancy - mortgage interest, rent, insurance, rates
- Running expenses - equipment like computers, printers, phones; phone calls’ line rental, internet usage, utility bills, heating, cooling lighting, cleaning expenses, repairs to office equipment
- Consumables - printer cartridges, stationary, internet and phone bills claimed as an expense.
- Self-education - you may be able to claim a deduction for self-education expenses if your self-education relates to your current work activities as an employee or if you receive a taxable bonded scholarship
Find an extensive list here.
HOME OFFICE EXPENSES CALCULATOR
The Home office expenses calculator helps you work out the amount you can claim as a tax deduction for home office expenses for the previous six income years.
METHODS OF CLAIMING
There are different methods of claiming - receipts or other written records/evidence or Tax Office rate per hour. Contact your tax accountant to work out what's best for you.
And don't forget, if in doubt, be sure to reach out to your financial advisors or tax agents for advice specifically tailored to your own circumstances.
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