Working from home allowance increased due to COVID-19

The Australian Taxation Office (ATO) is updating the cents per hour method for claiming work from home expenses. This allows people to claim 80 cents per hour for all their running expenses, rather than needing to calculate costs for specific running expenses.

Under the old rules, workers could claim a rate of 52 cents per work hour for heating, cooling, lighting, cleaning and the decline in value of office furniture, using a timesheet.

The change will apply from March 1 to June 30, after which the ATO will review the arrangement for the next financial year as the COVID-19 situation progresses.

Multiple people living in the same house will be allowed to claim the new rate and requirements to have a dedicated work from home area have also been removed.

You can still claim the non-reimbursed work-related portion of other expenses such as your phone and internet expenses, computer consumables, stationery and the decline in value of a computer, laptop or similar device.

What do you need to do

If this applies to your circumstances, you will need to keep a record of the number of hours worked from home.

If you are thinking of claiming this deduction, please remember:

  • Taxpayers must have spent the money themselves and not have been reimbursed,
  • The claim must be directly related to earning income and;
  • There must be a record to substantiate the claim.

Please do not hesitate to contact us should you have any questions.