Working from Home - Tax Deduction - Worth Paying for a Professional?

• 

  plmko on 08/08/2020 - 22:24

  +9

  Your usual claim is fake anyway and against the rules. So now you're able to legitimise your claim and better yet lift it to $448. Not sure how that's not a 'great' deal.

  • 

    Bmann999 on 09/08/2020 - 15:03

    -3

    Definitely not fake. You are not required to supply evidence for claims up to $300.

    I do use my personal phone, desk, electricity, and internet to work from home so I think that $300 is definitely justified. I just don't have the paperwork organised enough to document it well and I don't have time to read all the depreciation rules.

    I hear a lot about people's tax agents knowing all sorts of tricks for working at home. I am always skeptical because I figure I can just claim the $300 and save paying an agent fee.

    https://www.ato.gov.au/Tax-professionals/Your-practice/Tax-a….

    • 

      bobloblawlawblog on 28/10/2020 - 19:06

      So apparently this isn't actually true. It's technically correct but if you were audited you'd still need to provide the evidence.. or so i've read. I posted a deal for a tax deductions guide a few weeks ago that might help.

      I was in a similar position to you (and similarly confused) and it helped me a lot. Better than my experience with accountants. YMMV obviously

• 

  PissLUR on 08/08/2020 - 22:27

  Claim your usual $300 of other expenses and add the 50 cents per hour WFH. Don't use the shortcut covid method.

• 

  SBOB on 08/08/2020 - 23:29

  +4

  I haven't really spent any money this year specifically on work expenses

  And now you can legitimately claim the 80c a day…
  Win win

• 

  o53djz7qTPY4der on 09/08/2020 - 08:02

  +2

  I calculated everything manually. It took a bit of effort but it was way more than the 80c method.

  • 

    Bmann999 on 09/08/2020 - 16:24

    What kind of stuff did you claim for? Did you buy new monitors or a desk?

    • 

      o53djz7qTPY4der on 09/08/2020 - 18:45

      Yeah I bought quite a lot - two monitors, dongles, printer, chair, webcam,

      Aside from the stuff I bought -

      Utilities, Internet, Phone (This came is around ~$300 total).

      Paper, ink and other stationary.

      All of these were legitimate expenses.

      • 

        virhlpool on 29/11/2020 - 04:01

        Did you claim monitors, dongles, printer etc in full price or only in proportion for 4/12 (four months i.e. Mar to Jun)?

• 

  jasonofabargain on 09/08/2020 - 16:49

  lf you actually work 55 hours per week (for example), but get paid for 38 hours (as shown on payslip) - are you entitled to claim for the 55 or only the 38?

  Does claiming WFH void any other form of tax claims you can make? Or is there an overlap we should be aware of?

  • 

    Bmann999 on 09/08/2020 - 18:37

    +1

    Doesn't void it… but if you claim 80 cents per hour, that voids other work from home expenses. Don't know about working more than the 38 hours though.

• 

  GenotypeJim on 09/08/2020 - 22:28

  +1

  Use the $0.52 per hour version then you can claim other stuff like a % of your phone, net, etc.

• 

  EveryLastCent on 12/08/2020 - 11:23

  You normally claim $300 work related deductions without invoices/dockets etc for costs that you believe are justifiable. The ATO will only ask reasonable explanation. No paperwork required under $300 so you will be in the clear.
  Now you have $448 of work related claims for WFH, which again is justifiable and you can prove you worked from home. But any further work related deduction will be in the "over $300" range so ALL your work related deductions must be not only justifiable, but you need invoices/paperwork to prove them if requested. Supposing you are in the 39% bracket (37% + 2% medicare) the tax saving for the extra $300 deduction would be $117 ($300 x 0.39). Is it worth for you to keep, file, retrieve, assess and retain all said paperwork for $117?

• 

  bemybubble on 12/08/2020 - 15:58

  No paperwork required under $300 so you will be in the clear.

  Couldn’t be further from the truth. Although the ATO allow for substantiation exemptions, they also have the ability to request documentation supporting. Yes contradictory. But it’s a fact should they have suspicion

  • 

    Mad Max on 12/08/2020 - 22:18

    Not correct.
    Everylastcent is right.

    https://www.ato.gov.au/Individuals/Tax-return/2020/Tax-retur…

    You must be able to substantiate your claims for deductions with written evidence if the total amount of deductions you are claiming is greater than $300. The records you keep must prove the total amount, not just the amount over $300. The $300 does not include car and meal allowance, award transport payments allowance and travel allowance expenses. There are special written evidence rules for these claims which are explained at the relevant items.

    If the total amount you are claiming is $300 or less, you need to be able to show how you worked out your claims, but you do not need written evidence.

    • 

      bemybubble on 13/08/2020 - 05:50

      https://www.ato.gov.au/Media-centre/Media-releases/Do-not-be…

      “Many taxpayers don’t have a good understanding of what deductions they can claim, and believe they can claim for items which they in fact can’t. Some taxpayers even think that you can make a standard claim of $300 without having spent the money. You don’t need receipts for claims up to $300 but you must have actually spent the money, and be able to show us how you worked out your deduction if asked.”

      I’ve had 2 audits over this very issue. We had to supply diary notes as well as a couple of receipts for one client. The other we had to supply a credit card statement.

      Whilst they say it’s exempt they can ask for evidence.

• 

  tailgatinholden on 26/10/2020 - 13:10

  Hypothetical questions here, as this year I went to a tax professional, and they also used the 80c/hour rule. I was a little disappointed with my tax return, as I felt I spent much more on work-related costs. But thought it was a good lesson to learn from an expert this year.

  I work as a teacher from home (Zoom classes) since March, and have since built a home office (green screens, cameras, PC, monitors).. My major question is in regards to making a diary to demonstrate the % of use for my phone/internet, and as for electricity.. well.. I think it is impossible for me to calculate that.

  But just for internet for example.. I tried to ask whether that is in terms of time online or GB downloaded, and the accountant said either. If I were to record a representative month (4 weeks) of time or even GB downloaded for the whole financial year, is it correct to claim this much?

  internet plan per month: $100 for unlimited NBN
  diary lists: 200 GB downloaded for work, 200 GB downloaded for personal.. or maybe 240 hours for work, 240 hours for personal.

  Can I claim $50/month for 12 months ($600) for 50% of internet costs in my deductions?

  Same thing for phone. If I start a $120 plan for a new Pixel 5 for example…

  If I can record either half of my calls are to the office/work related, or maybe, half of my GB allocation is used to download work related content and I can report this for a whole month…

  Can I claim half of my phone plan for the year ($720) as a tax deduction?

  To me, it follows the letter of the rules.. but seems like it's excessive if they have that 80c rule thing.

  TIA.

  • 

    bemybubble on 26/10/2020 - 13:17

    +1

    Can I claim $50/month for 12 months ($600) for 50% of internet costs in my deductions?

    if your 4 week log demonstrates that - for sure.

    Same thing for phone. If I start a $120 plan for a new Pixel 5 for example

    Same response as above.

    If I can record either half of my calls are to the office/work related, or maybe, half of my GB allocation is used to download work related content and I can report this for a whole month…

    The ATO are merely looking for rationale of how you arrived at your %. A 4 week record is not defined under tax law - it is a principle given to ATO officers on how to apply the law. So long as you can demonstrate how you arrived at your % you'll be fine.

    I'll caveat the above in saying that the 80c rule doesn't allow you to claim phone and internet. Generally I find the 80c disadventageous. My wife is a school teacher and I stood completely clear of it and claimed actual use.

• 

  virhlpool on 29/11/2020 - 04:21

  Can you claim furniture/ equipment worth less than $300 each separately if you are using 52c per day flat rate method?

  I believe you can't do this if you use 80c per day method. Is that right?