• New Wave Accountants

More Profit, Less Effort: How to Claim Home Office Expenses

The idea of adapting to remote work in a time where COVID-19 is rampant and lockdowns are in order is one that can never be overlooked.

As lockdowns continue to be imposed and your operations face various shifts to ensure that the company adjusts accordingly, you may be wondering how to accustom yourself to the nuances of remote work. From the idea of handling management roles and processes to clarifying what constitutes as late and what doesn’t, it’s clear that adjusting to a Work-From-Home environment is no small feat.

Similar to many other tremendous changes, however, it’s vital to note that learning how to work remotely is also a matter of tending to details that play critical roles in the bigger picture. Among all the different bits and pieces that you’ll need to grow accustomed to as you make significant shifts, there’s one set of factors that you’ll need to handle best: The workaround of claiming home office expenses.

Why it matters to make your claims

Although it may not seem like much, learning how to claim home office expenses for your remote work set-up is something that can easily make a world of difference in your firm’s cash flow and revenues.

During times like these where every penny matters, getting returns on specific expenses can’t be overlooked if you want to keep everything smooth sailing until businesses can operate as before. When done correctly, reclaiming expenses can result in hundreds—or even thousands—of dollars being saved on recurring costs for the time being.

Fortunately, the same opportunities apply to the expenses of employees working from home and business owners who have their home as their principal place of business!

The basics of claiming deductions

If you’re looking to reclaim some of the expenses that you’ve made in the past few months on your remote operations, it’s critical to consider that there are specific details that must be followed.

Generally, the right to claim a deduction on a remote work experience only comes if you’ve spent the money on anything directly related to your employment or business. Additionally, you must also have an accompanying record to prove the legitimacy of each transaction that you want to reimburse.

Different methods for making claims on potential refunds

Thanks to the Australian Taxation Office’s efforts to help ease the process of staying afloat amid the pandemic, officials have created different methods that can be used to represent deductible costs. Here are three different ways that you can use to determine whether or not a part of your remote business operations is deductible come filing season:

The Fixed Rate Method: With this method, you can essentially claim 52 cents per work hour on heating, lighting, cleaning, and cooling alongside reclaimable costs at the same rate for the depreciation of office furniture. This also applies for claiming specific and actual expenses, such as stationery, Internet bills, phone bills, and depreciation on devices used for work, such as desktops, laptops, and smartphones.

The Shortcut Method: On the other hand, the shortcut method allows Australian businesses to claim deductions of 80 cents for every hour they spend working at home because of COVID-19. It is vital to note, however, that you are only eligible to follow this cost method for reclaimable expenses if you’re operating from home to fulfil your primary duties.

The Actual Cost Method: Another effective way to determine whether your costs are deductible or not is to use the actual cost method. According to this approach, you can make claims on actual work-related running expenses incurred at home that are calculated on a reasonable basis. However, it is also best to pay the ATO website a visit to learn about the specifics!


In this time of COVID-19 where it is far more challenging to operate, business owners are urged to capitalise on opportunities to recover lost income or break-even, which is where claiming home office expenses comes in. By taking the time to follow this guide and acting accordingly, you can get the hang of the workaround and start reclaiming eligible costs in no time!

We're a small business accounting firm in the Gold Coast that specialises in various services, such as company set-ups, outsourced bookkeeping and accounting services, and Xero consultancy. Get in touch with us today to see how we can help keep your business in peak financial shape!

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