These are the top 5 questions about claiming work from home deductions for the 2025 taxation year.
What is the fixed rate claim for 2025? The fixed rate for the 2024–25 income year is 70 cents per hour worked from home.
Is there a minimum number of hours to qualify for a working from home (WFH) deduction? No, there is no minimum number of hours required to claim a WFH deduction. However, in order to claim these expenses, taxpayers must:
- Be working from home to fulfil their employment duties, not just carrying out minimal tasks, like checking emails or taking calls
- Incur additional running expenses because of working from home
- Have records that show they have incurred these expenses.
What types of records do taxpayers need to prove their ‘total hours worked from home’? To use the fixed rate method, taxpayers must have records that show all of their hours worked from home between 1 July 2024 and 30 June 2025 (including their start and finish time, each time they worked from home). This can be recorded through a diary, spreadsheet, rosters or timesheets.
The record of hours must be made at the time they work from home, or as soon as possible afterwards. The ATO will no longer accept an estimate or a representative record.
If using the actual cost method, taxpayers will need a record showing a continuous 4-week period that represents the usual pattern of working at home – for example, a diary.
What is a practical way to prove work use of my phone? If using the fixed rate method to claim their working from home expenses, taxpayers cannot claim a separate deduction for their phone calls and data usage. These expenses are included in the fixed rate per hour.
If you are planning to use the actual cost method to claim working from home expenses, you will need to calculate your work-related percentage of phone calls and data usage on a reasonable basis.
Keeping a spreadsheet or diary for a continuous 4-week period is the easiest way to work out the deduction. This can be paper or electronic records that show how you calculated the percentage of work-related use (for example – number of phone calls made, or time spent using the internet for work versus private use).
A record of a continuous 4-week period representing work use can then be used across the rest of the income year to calculate the full deduction.
Can an employee claim rent as part of the actual cost method if they work from home full time? An employee working from home generally cannot claim for occupancy expenses such as rent, insurance or mortgage interest. However, there may be limited circumstances where a taxpayer has an area of their home set aside as a ‘place of business’. Please note If you intend to claim occupancy expenses, there may be capital gains tax (CGT) implications for your home.
For more detailed information on claiming work from home expenses, please contact our office.