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Claiming “working from home” business expenses at tax time

Working from home business expenses including setting up your home office
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Although tax is probably the last thing on your mind right now, it is something that you may want to start considering.

June 30 is just around the corner, so now is the perfect time to start gathering your receipts.

 

Claiming “Working From Home” Business Expenses

If you have been working from home due to the restrictions, you may have some additional expenses that you can claim in your next tax return.

Perhaps you’ve rushed out to buy:

  • a new work desk
  • a Bluetooth keyboard
  • a new laptop or computer
  • new stationery
  • a work phone
  • or even a webcam to conduct online meetings

You may have even noticed a spike in your household bills including:

  • power
  • lighting
  • heating & cooling
  • phone costs
  • internet costs

Or, you may have rushed out to buy some new equipment or assets as part of the new”asset write-off” regulations by the government.

Due to many working from home, we understand that it has opened up a can of worms in terms of what people can claim at tax time.

For some of you, you may be confused about what you need to do, and what you can and cannot claim this year.

 

The Big Question: “Can I get any money back for these expenses?”

The answer: Possibly…

For most of us, the best way to get some money back on these business related expenses will be by making a claim at tax time.

But there will be some things that you can not claim.

Here are some examples of what you may be eligible to claim in your tax return this year:

  1. New office equipment (new office chair, keyboard, laptop, webcam, desk, etc)
  2. Home office related expenses (stationery, printer ink, paper)
  3. A portion of your phone / internet expenses
  4. A portion of your home office running costs (eg. electricity, heating)

You may be thinking, “Yippee! I can claim all of these things…” BUT, you still need to fit certain criteria, keep the right records and have the evidence you need to back up your claims.

If you are unsure of what you are entitled to claim in your tax return, it’s always best to speak with your accountant.

That way they can give you expert advice and guidance.

If you’d like to learn more about what you can claim for your personal situation, give us a call on (03) 9762 7344.

Working from home business expenses including setting up your home office

Keeping the Right Records

On of the most important things you need to be doing right now is to be gathering and holding onto receipts and records.

If you’re wanting to claim some of your household running costs, you may also need to keep a 4-week diary showing the hours you are working from home. Especially, if you didn’t work from home prior to COVID-19.

Keeping the right records is key and will make processing your tax return at EOFY faster and more seamless.

 

Important Conditions

Here are some conditions which you need to consider if wanting to claim “working from home” business expenses at tax time:

  1. Working at the kitchen bench or table does not count as a home office
  2. You must have a separate room in your house dedicated to being a home office

If you don’t have a proper office set up, it’s worth talking to your accountant about what you can do.

 

As the isolation continues due to COVID-19, it is so important to stay organised.

Store your receipts in safe places and keep records.

This will allow your accountant to do the best they can to keep more money in your pocket, or to get your a greater tax refund at tax time.

We wish you all the best for the rest of the week.

Keep safe & healthy!

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