It’s tax time! It pays to learn what work-related expenses you can claim. Do you know what you can and can’t claim during tax time? Lodging your tax return is easy with the ATO’s Working From Home During Covid-19 Shortcuts and Work-Related Expenses Guide for individuals who work in sales & marketing.
New working from home during Covid-19 shortcut
Special arrangements this year due to COVID-19 will make it easier for people to claim deductions for working from home. The new arrangement will allow people to claim a rate of 80 cents per hour for all their running expenses, rather than needing to calculate costs for specific running expenses.
Multiple people living in the same house can claim this new rate. For example, a couple living together could each individually claim the 80 cents per hour rate. The requirement to have a dedicated work from home area has also been removed.
Assistant Commissioner Karen Foat said the new shortcut method will make it easier for those who are working from home for the first time.
“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.”
This new shortcut arrangement does not prohibit people from making a working from home claim under existing arrangements, where you calculate all or part of your running expenses.
Claims for working from home expenses prior to 1 March 2020 cannot be calculated using the shortcut method, and must use the pre-existing working from home approach and requirements.
The ATO will review the special arrangement for the next financial year as the COVID-19 situation progresses.
For more information about working at home during Covid-19 go to https://www.ato.gov.au/General/COVID-19/Support-for-individuals-and-employees/Employees-working-from-home/
Work-related expense deductions
Did you know that when completing your tax return, you may be able to claim deductions for some work-related expenses? To claim a work-related deduction:
- you must have spent the money yourself and weren’t reimbursed
- it must be directly related to earning your income
- you must have a record to prove it
If the expense was for both work and private purposes, you can only claim a deduction for the work-related portion. Common deductions for sales & marketing can include:
- Car expenses
- Clothing expenses
- Travel expenses
- Self-education expenses
- Home office expenses
You are accountable for the claims you make in your tax return, even if you use a registered tax agent to prepare and lodge it on your behalf. Remember to report all income in your tax return and remove any portion of your expense that is not work-related.
For more information or to download the ATO’s sales & marketing work-related expense guide go to www.ato.gov.au/sales20
Tax Tips
- Remember, you’re accountable for the claims you make in your tax return, even if you use a registered tax agent to prepare and lodge it on your behalf. Make sure you have records to prove your claims.
- The best time to lodge your tax return is mid-August, when all financial information the ATO receives from employers, banks, government agencies and more, will be pre-filled.
For more information, or to download the guides available for specific occupations, visit www.ato.gov.au/occupation20
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