COVID-19
ATO Working from home shortcut
Published 7/4/20
The ATO has made a major change this year as a result of the COVID-19 pandemic. The ATO is rolling out a new working from home shortcut which will make it easier for millions of Australians to claim tax deductions.
The special new arrangement will allow people to claim a rate of 80 cents per hour for all their running expenses, instead of calculating costs for specific running expenses as taxpayers would under normal circumstances. Multiple people living in the same house can claim this new rate individually, and it is no longer a requirement to have a dedicated work from home area in order to claim.
Taxpayers will only need to keep a record of the number of hours worked from home, rather than individual expenses. Assistant Commissioner Karen Foat says "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."
The new shortcut will be in place from 1 March to 30 June 2020.
This new shortcut arrangement does not stop people from making a working from home claim under the existing arrangements, which involves calculating all or part of your running expenses.
Claims for working from home expenses prior to March 1 can't be calculated using the shortcut method, and must use the pre-existing working from home approach and requirements.
The ATO is also reminding people the three "golden rules" for deductions still apply.
That means taxpayers must have spent the money themselves and not have been reimbursed, the claim must be directly related to earning income, and there must be a record to substantiate the claim.
STM's individual taxation experts who will guide you through the process of what and how much you can claim and will be in contact prior to 30 June to provide checklists for all clients.
Remember we are always here to help. If you have multiple years of taxation returns outstanding or are suffering some financial hardships which are affecting your ability to complete your tax returns, contact us to see how we can help.
https://www.ato.gov.au/Media-centre/Media-releases/New-working-from-home-shortcut/
https://www.ato.gov.au/General/COVID-19/Support-for-individuals-and-employees/Employees-working-from-home
