Claiming Home Office Expenses in your 2024 Tax Return 

Claiming Home Office Expenses in your 2024 Tax Return 

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Changes from 2023 to Home Office Expenses

gray leather office rolling armchair beside white wooden computer desk

Last year, the ATO announced significant changes to how you claim home office expenses on your 2024 tax return. At Jett Accounting Solutions, we’re here to ensure you get it right.

While some of these changes to work-from-home claims might seem complicated, Jett Accounting Solutions will automatically calculate which deduction method gives you the biggest refund, so you don’t have to worry about figuring it out yourself.

However, you may need to adjust your record-keeping habits, as the requirements are becoming more stringent.

Read on for a comprehensive overview of the changes to home office expense rules, including record-keeping requirements.


Important Changes to Home Office Tax Deductions

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  • The rate per hour you can claim has increased from 52 cents to 67 cents for each hour you work from home.
  • You no longer need a designated working area or home office.

While these changes seem beneficial, there are some downsides. The fixed rate of 67 cents per hour now includes or “absorbs” some tax deductions that you used to claim separately, which could result in a smaller refund.

Fortunately, Jett Accounting Solutions helps maximise your claim.


Items Included in the 67 Cents per Hour Rate


If you claim the 67 cents per hour, you cannot claim these items individually:

  • Internet expenses
  • Home and mobile phone expenses
  • Electricity and gas used for heating, cooling, and lighting
  • Stationery and computer consumables (printer ink, paper, etc.)


Additional Deductions You Can Claim

brown and white wooden desk with chair and laptop

While most common separate deductions are off the table, there are a few extra deductions you can still claim in addition to the 67 cents per hour rate:

  • Depreciation of assets costing more than $300, such as office furniture, computers, and mobile phones.
  • Expenses for work-related purchases up to $300, such as desk chairs and monitors.
  • The cost of cleaning your home office and repairing office furniture.


When Does the New Rate Start?


The changes to home office expenses apply to your 2023-24 tax return, which you will lodge from July 2024.


Impact on Your Tax Refund

a close up of a typewriter with a tax return sign on it

It is quite likely that your refund may be smaller. Historically, claiming each of your work-from-home expenses separately has led to a larger deduction claim. With the ATO rolling most of those expenses into the one 67 cents rate, your home office expenses claim will likely be smaller in 2024.


An Alternative Method: The “Actual Cost Method”

pink sticky notes on white paper

The “Actual Cost Method” allows you to claim all your expenses individually instead of the 67 cents per hour rate. These include:

  • Electricity and gas
  • Home and mobile phone expenses
  • Internet expenses
  • Stationery and computer consumables
  • Cleaning your home office
  • Depreciation on office equipment costing more than $300 (e.g., computer desk)
  • Office equipment costing less than $300

To use this method, you must keep either:

  • A continuous 4-week diary that tracks your usual pattern of working from home, or
  • A full 12-month record of the total number of hours you worked from home during the year.

For each deduction claimed using the actual cost method, specify how much of the item’s use was for work purposes.


Record-Keeping for Your 2024 Tax Return

pile of printing papers

Keep a Record of Hours Worked from Home: You must keep a record of the actual hours worked from home. Estimates are not accepted. Record these hours regularly throughout the year using one of the following methods:

  • Timesheets
  • Rosters
  • Employer system logs or online business systems
  • Time-tracking apps
  • A regularly updated diary, calendar, logbook, spreadsheet, or similar document


Records for Home Office Running Expenses: Keep a record of home office running expenses paid that relate to your hours worked at home. Records should include:

  • Bills/invoices for power, gas, home phone, mobile, and internet expenses (monthly or quarterly)
  • Evidence of shared expenses if bills are not in your name (e.g., joint credit card statement or joint property lease agreement)
  • Receipts for occasional expenses such as stationery, paper, or printing ink for work-related purchases


Which Method Is Best for You?


The best method depends on your personal circumstances. For many, the actual cost method will lead to a larger deduction, but some may find the new 67 cents per hour works out better.

Don’t worry – the Jett Accounting Solutions tax return system has built-in intelligence. Based on the information you enter, it will automatically calculate which method provides the biggest deduction and apply that to your tax return.

The most important thing for you to remember is the strict new requirements for record-keeping, especially tracking the hours you work from home throughout the year in a calendar or diary.

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