Tax time tips for the new normal
This new financial year, operating in the “new norm” of working from home, brings with it some new tax opportunities and implications for employees and small business owners.
The Australian Taxation Office (ATO) has released some information to help you understand what you can claim, and we have broken it down for you.
Here are 9 things you could claim for, provided you can substantiate the work related portion of these expenses:
- Home office work area equipment
- Phone expenses
- Internet expenses
- Electricity expenses
- Air conditioning, heating or cooling your home
- Computer related expenses
But, in case you’re wondering, there are several things you can’t claim:
- Toilet paper, despite it being a hot commodity these days!
- Sadly, you can’t claim normal occupancy costs, like rent, strata, rates or interest
- Everyday consumables like coffee, tea and milk
And there are some strict rules to adhere to when making deductions:
- When it comes to fixtures like furniture, you can either claim the full cost up to $300 or claim the decline in value over time;
- You can’t have been reimbursed for these items by your employer;
- The outgoing expenses have to be related to your ability to earn an income from home;
- You need to keep receipts or a record of the purchase; and
- If you wish to claim a tax deduction on equipment or furniture in the current financial year (2020/21) the asset would need to have been acquired for work use on or before 30 June 2021.
Hopefully these tips help you maximise your tax return, and when it does, let’s put that cash to good use towards your financial buffer for crises like COVID!
Please note that we are not able to provide you with personalised tax advice. This is general advice only and may not be appropriate to your personal circumstances. When writing this article we did not take into account your personal objectives, financial situation or needs. You need to get additional advice and take into consider the appropriateness of the advice having regard to your personal objectives, financial situation and needs, if you intend to act on any of the items discussed above and your accountant will be best able to support you with this.