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  • Work-related expenses

    We understand that the Australian community is continuing to adapt to the ongoing impacts of COVID-19. To support you and your clients, we're focused on easing the tax time burden by providing practical guidance to aid your conversations and help your clients get their work-related claims right.

    This year, you'll find three new occupation products for community support workers and direct carers, recruitment consultants, and gaming attendants. We've also refreshed the clothing and laundry poster and included new and contemporary examples in our tailored occupation guides.

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    Your clients' claims

    As the where, when and how of our work environment continues to evolve, so too may your clients' work-related expense claims. Tax time is an opportunity to review your client's circumstances and whether prior years deductions have changed in terms of their work-related use as well as provide you with new records to support their claims.

    We encourage you to access our advice and guidance products to facilitate these conversations and promote your clients to not simply roll over what they’ve claimed in prior years. There is no one ‘standard’ set of deductions, representative periods or apportionment.

    Working from home

    When claiming working from home expenses, it’s all about working out which methods your clients are eligible to use, and then determining which of those methods gives them the best outcome.

    Three methods are available for your clients to claim the working from home expenses they incurred during the 2020–21 income year. The method they use will depend on their circumstances as they must meet the recording keeping requirements and criteria to use each method.

    The three methods available are:

    • Temporary shortcut method – an all-inclusive rate of 80 cents per work hour, available for use between
      • 1 March to 30 June 2020 in the 2019–20 income year
      • 1 July 2020 to 30 June 2021 in the 2020–21 income year
      • 1 July 2021 to 30 June 2022 in the 2021 22 income year
       
    • Fixed rate method – 52 cents per work hour (instead of recording all your actual expenses for heating, cooling, lighting, cleaning and the depreciation of your furniture). You need to separately work out the work-related portion of your phone and internet expenses, computer consumables, stationery and computer depreciation expenses.
    • Actual cost method – the actual work-related portion of all your running expenses, which you need to calculate on a reasonable basis.

    Your clients generally can't claim occupancy expenses, such as rent, rates, mortgage interest and home insurance premiums, unless their home office is considered to be a 'place of business'. This occurs where their home office is both:

    • their principal place of work because no other work location is provided by their employer
    • exclusively or almost exclusively used for work purposes.

    They are not considered to be carrying on a business if their only income is paid to them as an employee.

    Employees who work at home can't claim costs for:

    • coffee, tea, milk and other general household items their employer may provide for them at work
    • the decline in value of items provided by their employer – for example, a laptop or a phone
    • anything their employer pays for or reimburses them for the expense.

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    Last modified: 15 Oct 2021QC 45702