SETTING UP YOUR HOME OFFICE? WHAT CAN YOU CLAIM?
The recent years have seen flexible and ‘work from home’ arrangements becoming increasingly common, especially since the onset of the pandemic. Whether you’re working for an employer or running your own business from a home office, you can make tax deductions and claims on furniture such as chairs, desks, and storage.
Can I Claim Home Office Expenses?
Some expenses can be claimed for tax deductions from a home office. To be eligible, you need to fulfil requirements including:
- Being working from home to carry out and complete your work duties and tasks, not just checking emails or taking occasional phone calls
- As a result of working from home, you incur additional expenses
What Can I Claim?
If you are planning to set up a home office because you are working from home, you can claim a deduction for some or all of the cost of setting up your home office. For example:
- Calculators
- Computers and software
- Desks, chairs and lamps
- Filing cabinets and bookshelves
- Professional libraries
You can claim a deduction for the decline in value of home office furniture, equipment, and technology such as computers, laptops and printers. This means you can depreciate them over some time and claim a deduction each year until it is ‘written off’ completely when they reach the end of their effective lives.
However, furniture pieces or low-cost office equipment that are costing less than $300 can be written off in full immediately, making it easy to purchase smaller items and claim deductions within the year.
Additional Expenses you may be able to Claim
- Occupancy expenses if you are operating a business from home (this may include rent, mortgage interests, council rates, and even house insurance premiums)
- Running expenses (generally, these are operating expenses such as utilities, electricity, internet, phone, cleaning, and depreciation of equipment, furniture and plant, including repairs and maintenance)
- Motor vehicle trip expenses for business purposes between your home and other locations
Keeping Your Records
Make sure that you keep clear and accurate records of all your expenses from the home office, and be aware that not everything can be claimed. For example, if you are an employee, you cannot claim costs on:
- Occupancy expenses if you are simply just working from home for your employer (as opposed to running your own business from home)
- General household items such as coffee, tea, and milk
- Home education such as setting up online learning and educational equipment, even if you’re working from home to supervise your children
- Anything that you have already been reimbursed by your employer
For more information, the ATO has a handy Home Office Expenses Calculator that you can use to work out your claim:
https://www.ato.gov.au/Calculators-and-tools/Home-office-expenses-calculator/, or work with an accountant that can help you avoid mistakes when lodging your tax return as well provide you with opportunities to maximise the return available to you.
Furniture for the Perfect Home Office
If you’re thinking of setting up your new home office space or just wanting to upgrade your existing workstation from home, then The Home Office can help. We believe that working from home should reflect who you are and how you work. This is why your home office should be a complete expression of you.
We have put together home office furniture packages that are designed to take the stress out of working from home. Why not get in now before the end of the financial year?
Get in touch to find out more today.
*Source:
https://www.ato.gov.au/Calculators-and-tools/Home-office-expenses-calculator/
