The Tax Office is making it easier – and cheaper – for millions of Australians to work from home during the coronavirus emergency, with new rules to allow taxpayers to claim more costs on their annual return.
The ATO said on Tuesday taxpayers would be allowed to claim a rate of 80 cents per hour for all their running expenses while working at home, rather than needing to calculate
specific costs.
Multiple people living in the same house will be allowed to claim the new rate and requirements to have a dedicated work from home area have also been removed.
The rule change will make it easier for Australians working away from their office to claim
expenses. Michele Mossop ATO Assistant Commissioner Karen Foat said the new shortcut method would help Australians who find themselves working from home for the first time because of the need to reduce unnecessary travel.
“The shortcut method provides a rate of 80 cents per hour and will only require you to keep a record of the number of hours worked from home,” Ms Foat said. “This recognises that many taxpayers are working from home for the first time and makes claiming a deduction much easier. "If you choose to use this shortcut method, all you need to do is keep a record of the hours you worked from home as evidence of your claim.” The change is backdated to March 1, 2020, meaning expenses before the start of last month cannot be calculated using the shortcut method.
The rules will remain in place until at least June 30.
This recognises that many taxpayers are working from home for the first time and makes claiming a deduction much easier. — ATO Assistant Commissioner Karen Foat Under the old rules, workers could claim a rate of 52 cents per work hour for heating, cooling, lighting, cleaning and the decline in value of office furniture, using a timesheet. The worker could also calculate the work-related portion of their phone and internet expenses, computer consumables, stationery and the decline in value of a computer, laptop or similar device.
Now the same worker can claim a rate of 80 cents per work hour for all additional running expenses.
Tracking by Google this week showed the length of time people are staying at home has jumped 13 per cent because of coronavirus shutdowns. Since the first week of January, the tech giant has tracked the movement of people via their locator function, finding a 58 per cent drop in visits to public transport stations and stops, a 33 per cent drop in visits to usual workplaces and a 13 per cent rise for people staying at their homes. The ATO has reminded taxpayers that the three golden rules for deductions still apply: taxpayers must have spent the money themselves and not have been reimbursed, the claim must be directly related to earning income and there must be a record to substantiate the claim. The ATO is preparing to review the special arrangement for the next financial year as the COVID-19 situation progresses. ATO Commissioner Chris Jordan has promised to help businesses and taxpayers disrupted by the COVID-19 crisis. The ATO is able to work with individuals experiencing financial hardship, and their tax agents, and will apply appropriate tax relief measures for serious and exceptional
circumstances, including where people cannot pay for food or accommodation. Assistant Treasurer Michael Sukkar welcomed the move.
"Today’s announcement is yet another demonstration of how every arm of government is working to keep Australians in jobs and businesses in business, and to build a bridge to recovery on the other side," he said.
"These new arrangements do not prohibit Australians from making a standard working from home claim using the two standard approaches should they wish to do so."
Source: Tax Accountant Melbourne
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