Work-From-Home Tax Deductions Australia — What You Can Claim

If you work from home for employment purposes, you can claim a deduction for the additional expenses you incur. The ATO offers two methods: the fixed rate method (67 cents per hour) and the actual cost method. Both require records — the main difference is what you can claim and how much admin is involved.

Key Takeaways

• The fixed rate (67c/hour) is simple but covers a fixed set of expenses — you cannot claim those expenses separately
• The actual cost method requires more record-keeping but may give a larger deduction
• Both methods require a diary or log of hours worked from home
• Claiming your mortgage or rent is not allowed under either method

Who Can Claim WFH Deductions?

To claim work-from-home deductions, you must:

• Perform genuine work tasks from home (not just taking calls or minor tasks)
• Have incurred additional expenses as a result of working at home
• Have records to substantiate the claim

It does not matter whether you have a dedicated home office — you can claim if you work from the dining table, a spare room, or a rented space within your home.

Method 1 — Fixed Rate Method (67c per hour)

The fixed rate of 67 cents per hour covers:

• Electricity and gas
• Internet (the work proportion)
• Mobile and home phone usage (work proportion)
• Stationery and computer consumables (pens, paper, printer ink, toner)

What is NOT covered by the fixed rate (claim separately):

• Decline in value (depreciation) of work-related equipment — computers, printers, desks, chairs
• Repairs to home office equipment
• Other running costs not listed above

Record requirement: You must keep a diary or log of actual hours worked from home for the entire year. A “representative four-week period” is no longer accepted for the fixed rate method from FY2022–23 onwards.

The log can be in any format — a spreadsheet, calendar notes, a timesheet app. It must record the actual hours for each day or shift.

Calculation example:

• 3 hours WFH per day × 5 days × 48 weeks = 720 hours
• 720 × $0.67 = $482.40 fixed rate claim
• Plus: depreciation on work desk ($200 × 50% work use / 10-year life = $10/year) — claimed separately

Method 2 — Actual Cost Method

Under the actual cost method, you claim the actual additional cost of each expense type, apportioned to the work-related use.

What you can claim:

• Electricity and gas — calculate the cost per hour for running your heating/cooling and lighting in the home office space, multiplied by hours used for work
• Internet — work proportion of your annual internet bill (based on a representative usage diary)
• Phone — work proportion of calls and data
• Depreciation on furniture and equipment — desk, chair, monitor, printer, keyboard, mouse — claimed at their decline in value over effective life, at the work-use percentage
• Cleaning costs — if you have a dedicated home office, a proportion of cleaning costs

What you still cannot claim:

• Mortgage interest or rent — these are private expenses even if you work from home
• Coffee, meals, or snacks consumed at home
• General household items not used for work

Record requirement:

• Detailed records of each expense
• A diary or log of hours worked from home and hours using specific equipment
• Bills and invoices for all claimed expenses

The actual cost method typically gives a higher deduction for people with a dedicated home office, significant equipment investment, or high energy costs — but requires significantly more record-keeping.

Comparison: Fixed Rate vs Actual Cost

What You Cannot Claim (Both Methods)

• Mortgage repayments or rent
• Occupancy costs (rates, body corporate fees) — unless the home office is used exclusively for business and you are self-employed
• General household expenses (groceries, cleaning for the whole house)
• Internet costs that are already covered by the fixed rate (if using that method)

Frequently Asked Questions

Can I claim WFH deductions if my employer requires me to work from home? Yes. Whether WFH is employer-required, a mutual arrangement, or a personal choice, the deduction is available as long as you actually perform work tasks at home and incur additional costs.

I switched from home to office mid-year. Can I still claim? Yes — you claim based on the actual hours or costs incurred during the period you worked from home. The calculation is simply pro-rated for the part of the year that applies.

Can I claim both the fixed rate and depreciation? Yes. The fixed rate covers electricity, internet, phone, and stationery. Depreciation on work-related equipment (computer, desk, chair) is claimed separately on top of the fixed rate.

Can I claim if I am self-employed or a sole trader? Yes — the same methods apply. Self-employed people working from home may also have access to occupancy cost claims (rent proportion) if the home office is used exclusively and regularly for business — but this affects the main residence CGT exemption. Seek specialist advice.

This article provides general tax information. For advice tailored to your situation, speak with a registered tax agent. Find one through the Tax Practitioners Board register.