Calculating WFH Deductions - a summary
As a reminder around WFH deductions, please see key points listed below - if you need more detail, please see information in: PR News - WFH deductions detailed
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Before 1 July 2022
Before 1 July 2022, taxpayers had the choice of using one of three methods to calculate their deduction for WFH expenses:
- the shortcut method
- the fixed rate method
- actual expenses.
The shortcut method (a temporary measure during the COVID period), ended 30 June 2022.
After 1 July 2022
From 1 July 2022, taxpayers can continue to claim their actual expenses, or they can use the fixed rate method.
Under the guidelines, the fixed rate per hour worked from home is:
- 67 cents per hour for the 2022–23 and 2023–24 income years; and
- 70 cents per hour from 1 July 2024.
Working out deductions is quite technical in terms of eligibility and the actual calculation. The keeping of honest and accurate records is most important (including cost of allowable expenses incurred, time worked, use of assets).
When an expense is incurred for both private and work purposes, only the work-related portion can be claimed as a deduction. The deduction needs to be apportioned on a fair and reasonable basis.
It is also important to be aware of what cannot be claimed – for example: the cost of coffee, tea, milk and other general household items (even if the employer provides these at work) cannot be claimed.
We encourage you to consult us for advice in relation to your specific circumstances. Please call us on 07 3391 7566.
