Thousands of Australians are adjusting to working from home for the first time as the coronavirus crisis forced offices around the nation to close.
As a result, stationery shops are running out of stock, the NBN has been forced to free up more capacity and telecommunications companies have begun sharing data to lessen the workload.
Working from home comes with its unique challenges and unique costs: you are now suddenly financially responsible for operating your own office.
Here’s a quick guide on what you can claim on tax as a result of your self-isolation.
In essence no – and you should also have a chat with your employer about providing you with equipment needed to do your job.
If you didn’t need a new computer to work from home, but thought now would be a good time to upgrade, there are some expenses you can deduct at tax time.
According to the Australian Tax Office (ATO), you can claim the full cost of items you’ve had to buy for your home office, up to $300.
It’s highly likely your brand spanking new computer cost more than that, in which case you can deduct the decline in value of your new laptop (depreciation). The ATO has a handy depreciation tool here.
Yes, you can. The tax office recognises that running a dedicated workspace takes a toll on your power bills.
As a result, you can claim a work-related proportion (read that twice) of your running expenses such as heating, cooling and lighting.
Other running expenses include the cost of repairs to your equipment (fixing laptop), cleaning costs (sanitising your work area) and consumables such as printer ink and paper.
Here’s where things get tricky. The ATO essentially allows for two ways: an easy way and a hard way.
The hard way requires you to calculate your work-related expenses of working from home, meaning you’ll need to keep tight records of the hours you work and work out a proportion of your heating, cooling, lighting, cleaning and the decline in value of furniture.
That’s pretty tough.
The easy way is to deduct what the ATO has calculated to be a fixed rate of 52 cents for each hour you work from home. A standard eight-hour shift would likely mean you could deduct $4.16 for running expenses for each day you worked from home.
If you think that’s stingy, head online to the ATO for a full breakdown of how to calculate your running expenses down to the last cent.
You’ve likely only just started working from home in the past seven days. I urge everyone who has done this to grab themselves and clean and un-scribbled diary to set aside as your tax record.
Generally, the ATO needs a four-week representative period to work out approximate ongoing running expenses, so you’ll need to be tight with your notes until May.
In this diary make sure you immediately pop any receipts for anything you’ve paid for to work from home – that’s a good start.
From there, for each day record the hours you work, the number of work calls you make and preferably even who they were to if you don’t get an itemised phone bill.
Also pop down how much you are paying for internet (you can claim up to $50 with limited documentation, so better to keep tight records) and how much you are paying for your phone.
Don’t be like that – five minutes a day could result in you getting paid what you are actually owed by the tax office.
Remember a tax return isn’t some bonanza lottery where you try and swindle your way to a winter cash boost – it’s simply getting returned how much you’ve overpaid the ATO.
The information provided on this website is general in nature only and does not constitute personal financial advice.
Written by Stuart Marsh for 9 News