This year many of us have been forced to work from home due to the Coronavirus outbreak. The Australian Taxation Office (ATO) has introduced a temporary short cut method to make calculating home office running expenses easier for taxpayers to include as a deduction in their tax return.
Short cut method
The short cut method will apply for all home office running expenses incurred between 1 March 2020 and 30 June 2020 and will be calculated at a rate of 80 cents per working hour.
This deduction can be claimed for each hour worked from home due to Coronavirus as long as you:
- Worked from home to fulfill your employment duties and not just carried out minimal tasks such as occasionally checking emails or taking calls
- Incurred additional deductible running expenses as a result of working from home
You do not need to have a separate or dedicated area of your home set aside for work to claim this deduction.
The short cut method covers all deducible running expenses including:
- Electricity for lighting, cooling or heating and running electronic items used for work (eg. your computer) and gas heating expenses
- The decline in value and repair of capital items, such as home office furniture and furnishings
- The decline in value of a computer, laptop or similar device
- Cleaning expenses
- Phone expenses, including the decline in value of the handset
- Internet expenses
- Computer consumables e.g. printer ink
- Not all of these expenses need to have been incurred, however you must have incurred additional expenses from some of these categories as a result of working at home due to the Coronavirus
- If you use the short cut method to claim a deduction for your additional home office running costs you cannot claim a further deduction for any of the above listed expenses
- You must keep a record of the number of hours you worked at home due to the Coronavirus e.g. timesheets, diary notes or rosters etc.
For more information click on the below link to the ATO’s website: