PCG 2023/1 outlines the ATO’s new method (the ‘fixed-rate method’) for calculating additional running expenses while working from home, which has applied from 1 July 2022.
The fixed-rate method allows taxpayers to claim at a rate of 70 cents per hour for the additional running expenses for working from home:
- Energy expenses (electricity and gas) for lighting, heating, cooling, and electronic items used while working from home;
- Internet expenses;
- Mobile and home phone expenses; and
- Stationery and computer consumables.
However, PCG 2023/1 does not cover occupancy expenses relating to a home, such as rent, mortgage interest, property insurance and land tax.
Taxpayers are not required to use the above fixed-rate method – as from 1 July 2022, they can instead continue to claim the actual expenses they incurred as a result of working from home and keeping all records necessary to substantiate their claim.
Please be aware that you are required to keep relevant diaries or timesheets for this expense to be deductible.