ATO has released details of a new method to claim working from home deductions for employees who have been affected by Covid-19 restrictions.
If you have been forced to work from home due to the current pandemic, you will be able to claim a deduction for the additional running expenses that you incur. The new rules make claiming these expenses much easier.
Expenses you can claim
Expenses you can’t claim
If you are working from home only due to COVID-19, you:
Calculating running expenses
There are three ways you can choose to calculate your additional running expenses:
You can claim a deduction of 80 cents for each hour you work from home due to COVID-19 as long as you are:
You do not have to have a separate or dedicated area of your home set aside for working, such as a private study.
The shortcut method rate covers all deductible running expenses, including:
You do not have to incur all of these expenses, but you must have incurred additional expenses in some of those categories as a result of working from home due to COVID-19.
If you use the shortcut method to claim a deduction for your additional running expenses, you cannot claim a further deduction for any of the expenses listed above.
You must keep a record of the number of hours you have worked from home as a result of COVID-19. Examples are timesheets, diary notes or rosters. Click here for our template
If you use the shortcut method to claim a deduction and you lodge your 2019-20 tax return through myGov or a tax agent, you must include the note ‘COVID-hourly rate’ in your tax return.
Records you must keep
If you use the shortcut method, you only need to keep a record of the hours you worked at home, for example, timesheets or diary notes.
If you use the other methods, you must also keep a record of the number of hours you worked from home along with records of your expenses. For more information on what those records are see Home office expenses.