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  • Writer's pictureAmanda Amey

Changes to Working from Home Tax Deductions 2022-2023 Australia

Updated: May 19, 2023

From the 1st July 2022, new Working from Home Tax deductions will apply.

Whilst you used to be able to claim the old fixed rate method ($0.52 cents per hour) or the short cut method ($0.80 cents per hour) the new fixed rate method is now $0.67 cents per hour.

The only alternative would be to claim the actual cost method, which requires a whole lot more record keeping, calculations and you need to have a dedicated office space.

There have also been changes to what records are required. You can no longer rely on just a single 4-week representation diary. (Yikes!) You need to keep a record of all the hours you have worked from home for the entire year.

What's the New fixed rate method?

The new fixed rate method applies from 1 July 2022 and is $0.67 cents per hour.

Do I Need a dedicated office?

The revised fixed rate method doesn’t require that you have a dedicated home office space to claim working from home expenses. If you work from the kitchen or living room, you can still claim a deduction.

What’s covered by the work from home fixed rate?

The new work from home fixed rate of $0.67 cents per work hour covers:

  • Phone usage (mobile and home)

  • Internet

  • Energy expenses (electricity & gas)

  • Stationery and computer consumables

No additional deduction for any expenses covered above can be claimed if you use this method.

Importantly phone usage and internet expenses are now included in the fixed rate method. Whilst previously you could still claim telephone and internet expenses over and above the fixed rate method, from the 1st July 2022 you cannot. There are no more separate deductions for phone and internet usage. (Yikes)

What can I claim separately for home office expenses?

  • The decline in value of assets used while working from home, such as computers and office furniture.

  • The maintenance and repairs of these assets.

  • The costs associated with cleaning a dedicated home office. (The office must be a dedicated office space in this instance)

How can I prove I have worked from home?

From 1st March 2023 you need to keep a record of all the hours worked from home for the entire income year. You cannot rely on just a 4-week representation diary and definitely no estimates. You will need to substantiate the actual expense too. (A record of a bill)

These records that can substantiate your working from home hours can include logs assessing cloud business systems, diaries, timesheets etc.

Can I still claim actual costs for working from home?

The actual cost method hasn’t changed and yes, you can still claim the actual work-related portion of all running expenses as long as you have a dedicated home office space. You cannot claim this method working from the kitchen bench, or lounge.

For more information or if you would like us to prepare your tax returns, please contact our office to arrange an appointment.

This articles intention is to inform rather than advise and is based on legislation at the time. Each Taxpayer’s circumstances vary so we strongly recommend that you discuss this information with your Tax Agent, Accountant or Bas Agent before implementation. If you take, or do not take action as a result of reading this article, we accept no responsibility for any financial loss incurred. This is general advice only.


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