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Take advantage of our Free Home Office Deductions Guide

Do you sometimes work, or run your own business from home? The following are some items you can include in your deductions for work related purposes.

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Tools, equipment and other assets:

  • computer
  • phone
  • desks, chair and lamps
  • filing cabinets and bookshelves
  • hand tools or power tools
  • protective items, such as hard hats, safety glasses, sunscreens and sunglasses
  • professional libraries
  • safety equipment
  • technical instruments

You can also claim the cost of repairing and insuring your tools and equipment. And any interest on money you borrowed to purchase these items. For items costing above $300, the deductions need to be through decline in value (depreciation).

If the tools are used for both work and private purposes you will need to apportion the amount you claim. For an example, if you have a computer that is used for private purposes for half of the time you can only deduct 50% of the cost.

Running costs
If you perform some of your work from a home office, you may be entitled to a deduction for the costs you incur in running it. These could include the following:

  • Work-related phone calls (including mobiles) and phone rental (a portion reflecting the share of work-related use of the line).
  • Utilities, such as gas and electricity that can be apportioned to the business.
  • Costs of repairs to your home office furniture and fittings
  • Cleaning expenses

If you are running a business from home:

You can claim a deduction for the following:

  • The cost of using a room’s utilities, such as gas and electricity. This must be apportioned between business and private use. Based on actual usage.
  • Business phone costs. If a telephone is used exclusively for business, you can claim for the rental and calls. If the telephone is used for both business and private calls, you can claim a deduction for business calls.
  • Decline in value (depreciation) of office plant and equipment, such as desks, chairs, and computers. If equipment such as a computer is also used for non-business purposes, your claim must be apportioned between business and private use.
  • Decline in value (depreciation) of curtains, carpets and light fittings.
  • Occupancy expenses (such as rent, mortgage interest, insurance, rates). You can claim the portion of these costs that relate to the room or workshop you use as a place of business. A common method of working out how much to claim is to use the floor area (as a proportion of the floor area in your whole home).

Note: If you claim deductions on occupancy expenses, you could lose part of your exemption on future capital gain on the main residence. Please consult a Tax Accountant for more details.

Declaration: We hope this information will be useful to you. Remember, this article has been prepared without specific knowledge of your financial situation. Before making financial decisions or plans be sure to consult with an Accountant or a Financial Advisor.

Declaration: The Excel files and content of this website have been prepared without taking into account your personal financial situation or knowledge of your financial needs. Impact Taxation and Financial Services cannot be liable for any losses or damages arising from using the information provided. It is the user’s responsibility to seek independent advice from a professional accountant before implementing any financial plan.