Work from home tax deductions

Hello all,
Have been working from home since march and have spent on below items since employer indicated wfh will continue till year end.

  1. Used monitor from gumtree - $250 - only have the chat messages as proof of purchase.
  2. Assembled new workdesk and a small drawer/storage from parts from ikea and bunnings - $150
  3. Ikea computer chair - $150
  4. Bunch of accessories - keyboards and mice, laptop cooler stands, a external webcam - around $180
  5. My wife is thinking to get a new monitor for herself as she started working from as well - $300 or less

All these are 95% work use only, purchased by me (not reimbursed by employer), have set up these as dedicated home office.

Which of these am i eligible to claim ? I am employed full time (contract), but no ABN.
Does it matter i have purchased all these only recently ?

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Australian Taxation Office
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Comments

    • Thanks ! read thru that page, still unclear about above questions if I can claim for buying a used monitor, self assembled furniture and also the accessories ?

      • +5

        More information
        For more information on working from home, visit Home office expenses or speak to a registered tax professional.

  • +3

    I doubt you can claim your used monitor from Gumtree purchase as there's no tax invoice.

    • yeah, thats one of the main reasons i thought i will ask. I have their original receipt, but obviously it not in my name.

      • I would argue that it's possible but you need to demonstrate and prove that the money actually changed hands…

        https://www.insightaccounting.com.au/2017/04/claiming-gumtre...

        • Probably not a great path to go down, per the info on that link ..
          For me I can only show a atm withdrawl for that amount, no way to prove who i gave that money to other than the date / timing.

          • @anxiousdevices: Hey I updated the link sorry. Have a look again and notice that an ATM withdrawal around the same time can count as evidence.

            As mentioned though I think you can only claim the depreciation.

            • @inherentchoice: But you don't want to really attract an audit as that would be a huge hassle.

              • @thatonethere: For most audits they target people with unusual levels of deductions for their occupation or income.

                Why would genuinely claiming depreciation on a Gumtree item attract an audit? And why would it be a hassle to show the records you kept if audited, including the ATM withdrawal transaction and other evidence of the purchase via Gumtree?

                • @inherentchoice: If you had a receipt sure but their audit case studies specifically target people who claim stuff they bought on gumtree.

                  • @thatonethere: Have you filled out a tax return lately? At which item did you write Gumtree?

                    You don't write Gumtree at any item. You just write your calculated deductions. You just write totals.

  • -2

    You can't claim the chair - I tried that in a previous year

    • Really !? Any reasons why we cant claim a computer chair ?
      "I tried that in a previous year" - Did you get audited ? Did you have to amend it later on ? Or was it your tax agents advice ?

      • tax agent's advice - he was pretty adamant

        Re your accessories, you can claim that in a low value pool: https://www.ato.gov.au/Business/Depreciation-and-capital-expenses-and-allowances/General-depreciation-rules---capital-allowances/Low-value-assets-(pool)/

        and see also: https://www.ato.gov.au/Individuals/Income-and-deductions/In-detail/Capital-allowances---$300-immediate-deduction-tests/

        • Didnt know about the low value pool, thank you for the links !

        • +1

          According to ATO website, if you use the actual cost method, you can claim furniture and furnishings, including the desk and chair…

          https://www.ato.gov.au/Individuals/Income-and-deductions/Ded...

          • @inherentchoice: On that page -
            "You can use the depreciation and capital allowances tool to calculate your deduction for the decline in value of equipment, furniture and furnishings that cost more than $300, use the depreciation and capital allowances tool to work this out."

            Does this mean I can claim the full amounts for desk and chair as they cost 300 ?

            • @anxiousdevices: Okay yes it looks like you can only claim their decline in value sorry.

              Under the actual expenses method, you can claim the additional running costs you directly incur as a result of working from home. This may include the following expenses:

              • the decline in value of home office furniture (desk, chair) and furnishings,

              Ultimately you may have more deductions if you use the shortcut $0.80 method?

              • @inherentchoice: Yep, gonna compare what is better value vs lesser documentation needs. Probably easier to use the shortcut $0.80 method unless it make s difference to use the actuals method.

                • +1

                  @anxiousdevices: Note you can claim for running expenses and still claim capital expenses.
                  So you can still claim 52c/hour running costs plus the expenses above.
                  This is likely the optimum for you unless you have very high bills.

                  Money magazine link explains it pretty well:
                  https://www.moneymag.com.au/coronavirus-work-from-home-tax-d...

                  • @mskeggs: I was reading this month's Money Australia magazine. The writer states the traditional method "Occupancy Method" is still the best, but of course there's a lot more administration on your part recording everything.

                    I'm going to run both scenarios and see which is best.

          • @inherentchoice: I need a new accountant :(

  • +2

    Don't see why you can't claim all of the above at 100% as its less than the $300.

    • Yeah, that would be the best case scenario, but i have a few "complications" with the used monitor, and self assembled furniture with multiple receipts ?

      • +2

        Who assembled it is irrelevant, you are claiming the cost of the item(s) i.e. the receipts. I'll be claiming my new standing desk depreciating over x years, probably a new chair if i find one on sale over the next fortnight, and a few other items as i do most years. Been working from home after hours for more years than i care to remember its all pretty straight forward as long as you have proof of purchase and can prove actually working from home.

    • +1

      Agreed. No reason not to claim 100% of each of these items if they are for business use.
      Don’t fool around with depreciation, these are all expenses under $300 so can be written off immediately. Not sure what that advice up thread was about.

    • I could be wrong, but my understanding is you can only deduct it all if the total deduction is less than $300. But given all those items add up to over $300, it should be depreciated.

  • +1

    Proof of purchase only becomes relevant if you're unlucky enough to be selected by the ATO for an audit.

    The ATO's audit resources are limited, and they generally choose to go after selected tax-payers for an audit, based on how likely they think the selected persons are doing something dodgy with their taxes.

    Based on reading news articles about ATO audits, it seems to me that the ATO selects people for audit based on whether their deductions are significantly greater than those of the "average" tax payers in a similar occupation.

    So, if the "average" accountant claims a work expenses tax deduction of $1,500, but one accountant claims a tax deduction of $7,000 then that guy is more likely to be chosen for an audit.

    The "average" tax deduction this year is likely to be higher because of other taxpayers also claiming working from home expenses.

    Your total deduction of $1,030 does not seem particularly high to me, if this is the only work-related expense deduction you're claiming, and you're earning the average wage of a white-collar worker.

  • Just claim your fair usage (95% in your case) of everything. Keep the official receipts and if you really want to cover yourself, do a hand written receipt for the gumtree item.

    You can't claim a dollar value for your labour for the self-assembly or driving to/from Ikea, etc.

    Every man and their dog will be claiming as much as possible for WFH this tax year and some will get greedy and claim a lot more than what you have. A lot of people will have bought the antique mahogany desk they've always wanted. there will be some idiots that will try and claim a new lounge suite because they are trying to replicate the chill-out area at work. The ATO algorithm will catch some but not all.

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