Work Related Deductions

Jun 20, 2023

Work from Home and Related Expenditure

Working from Home

The ATO has revised the methods for claiming home office expenditure.

To make any claims for work related home expenditure you must:

  • incur additional home expenditure as a result of working from home; and
  • you must keep complete and accurate records of the time you were performing work from home.

There are now two methods you can use:

  • A revised fixed rate method of 67 cents per hour which includes internet, mobile, electricity, stationery and consumables together with a separate deduction for decline in value eg computers and furniture; or
  • Actual expenditure which will require you to keep records and data for the claims made.

You will need to keep and produce actual records ie. diaries, rosters and timesheets to record the hours together with evidence you actually incurred expenditure. Estimates are now no longer acceptable.

LMITO Removal

The 2022 Federal Budget withdrew the Low and Middle Income Tax Offset.  This initiative was for employees earning between $37,000 and $126,000 and provided an additional refund of up to $1,500.  With its removal, clients may notice that their refunds are not quite as healthy as previous.

Self Education Expenses

In a long awaited announcement, the ATO has removed the need to reduce self-education expenses by $250.  You can now claim a deduction for all allowable self-education expenses.

Work Related Car Expenditure

Motor vehicle expenses can be claimed under one of two methods, either the cents per kilometre method or the logbook method. 

The cents per kilometre method allows a deduction of 78 cents per kilometre for the 2022/23 financial year and estimated 85 cents for the 2023/24 financial year, up to a maximum claim of 5,000 kilometres.  You do not need to retain any receipts of expenditure under this method but are required to provide evidence of how you calculated your work related kilometres.

Under the logbook method you can claim a percentage of actual motor vehicle expenses incurred.  A logbook is required detailing odometer readings of both work related and private travel over a continuous 12-week period.  The percentage is calculated on the basis of total business kilometres divided by the total kilometres travelled.  The logbook is valid for 5 years unless there is a change in your circumstances such as changing jobs. 

Our team of experts accountants are here to assist you in identifying and maximising your work related tax deductions.  Please reach out to discuss your specific situation and ensure you receive the best possible outcome.

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