By business reporter Nassim Khadem
ATO – Claiming tax deductions for working from home due to coronavirus is being made easier.
The Australian Taxation Office (ATO) is introducing a new method which will allow people to claim 80 cents per hour for all their running expenses, rather than needing to calculate costs for specific running expenses.
The change will apply from March 1 to June 30, after which the ATO will review the arrangement for the next financial year as the COVID-19 situation progresses.
“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,” Assistant Commissioner Karen Foat said.
“We needed something to help people through this time to make it easier to work out how much they can claim.
“We think the 80 cents per hour method is much simpler for people. It’s quite generous and we envisage a lot of people will want to use that rate.”
Multiple people living in the same house will be able to claim the new rate.
“For example, a couple living together could each individually claim the 80 cents per hour rate,” Ms Foat said.
And the requirement to have a dedicated work-from-home area has also been removed.
“This recognises that many taxpayers are working from home for the first time and makes claiming a deduction much easier,” Ms Foat added.
The new arrangement does not prohibit people from making a working-from-home claim under existing arrangements, where you calculate all or part of your running expenses.
“Claims for working-from-home expenses prior to March 1, 2020 cannot be calculated using the shortcut method and must use the pre-existing working from home approach and requirements,” Ms Foat said.
If the Federal Government announces a prolonged lockdown extending into the next financial year the ATO is likely to extend the new claiming method.
“We can’t predict the future … but if people are still being encouraged to work at home by the Government then we would extend it into the new financial year,” Ms Foat confirmed.