Many taxpayers conduct some of their work from home. And it is deductions on these home-based activities over which the ATO is cracking down on – hard.
The ATO says that record numbers of Australians are now claiming deductions for costs incurred while working from home, but that a “high level” of mistakes – whether intentional or not – are causing it to increase attention on such claims this tax season.
6.7 million taxpayers claimed a record $7.9 billion in “other work-related expenses” last financial year. This category includes home-based expenses.
While extra costs related to working from home are usually deductible there is a lot of over-claiming or claiming private costs,
A common one is putting through the entire mobile phone or internet bill, which is a big no-no. Only the work-related components of such expenses are eligible to be claimed.
If working from home means sitting in front of the TV or at the kitchen bench doing some emails, it’s unlikely that you are incurring any additional expenses.
However, if you have a separate work area, then you can claim the work-related portion of running expenses for that space
To claim working from home expenses, taxpayers must keep supporting records such as receipts, diary entries and itemised phone bills or other records. Even though detailed receipts are not required for phone and internet claims up to $50 per year, it’s not an automatic entitlement – you still need to be able to show how you calculated your claim.
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