COVID-19 has had a major impact on Australian society and this has extended to the way many work. Working from home has become a common occurrence and with the social distancing rules in many cases is the new normal. The ATO has recognised this fact and has introduced a new way that taxpayers can calculate their home office claims from 1 March 2020 to 30 June 2020.
A new 80 cents per hour claim can be made in the 2020 tax return for this 4 month period with taxpayers only needing to have an accurate estimate of the hours worked during this period. Taxpayers will still need to prove they have incurred home office costs (i.e. gas, electricity, internet, home phone), that these costs were not reimbursed by their employer and that the costs were related to their income earned. Pleasingly there is no need for taxpayers to prove they kept a separate home office area and it is possible for multiple people in the same household to claim this rate.
Timesheets and calendar entries are sufficient evidence for this claim and it is recommended taxpayers keep track of their hours for this period. Home office claims for the period prior to 1 March 2020 will be subject to the old 52 cents per hour rate and subject to the tougher substantiation claims. If the lockdowns extend to the 2021 financial year it is anticipated this new 80 cents rate will be extended.
If you have any queries regarding your home office claims, please do not hesitate to contact us. For further information, you can also refer to the ATO website, link below.
