There have been changes made to the method of calculating work from home deductions from the 1st March 2023 for the 2022-2023 income year.
While the ‘Actual Cost Method’ remains unchanged, the ‘Fixed Rate Method’ has been revised allowing a 67 cent per hour tax deduction up from 52 cents. This new rate covers energy expenses including electricity and gas, phone usage (both mobile and home), internet usage, computer consumables and stationery.
Other changes to the Fixed Rate Method include:
• Removing the requirement to have a dedicated home office space.
• The ability to separately claim the work-related portion of the decline in value of depreciating assets; such as furniture and computer equipment, as well as any repairs of costs associated with cleaning.
It’s important to consider which method will best suit you. Regardless of which you choose, remember that to claim a deduction for working from home you must:
• Have incurred additional expenses because of working from home.
• Have kept a record for the full year to prove the hours worked from home. A diary or timesheet needs to be kept from 1st March 2023 to claim under the new requirements.
• Have kept a record for each expense claimed.