The ATO has extended, from 30 June 2020 to at least 30 September 2020, the “shortcut” rate for claiming work-from-home running expenses. This shortcut is for eligible taxpayers to claim running expenses incurred between 1 March 2020 and 30 September 2020 at the rate of 80 cents per work hour, provided they keep a record of the number of hours they have worked from home.

Taxpayers who are eligible to use the shortcut rate are employees and business owners who:

• Work from home to fulfil their employment duties or to run their business during the period of 1 March 2020 to 30 September 2020, and
• Incur additional running expenses that are deductible under the new tax law

The additional running expenses that are covered by this shortcut rate includes lighting, heating, cooling, cleaning costs, electricity for electronic items used for work, the decline in value and repair of home office items, phone and internet expenses, computer consumables, stationery and the decline in value of a computer. Taxpayers who use the shortcut rate to claim a deduction for their additional running expenses cannot claim any further deductions for the listed expenses.

People who choose not to use the shortcut rate can instead:

• Claim 52 cents per work hour for running costs plus claiming the work-related portion of phone and internet expenses, computer consumables, stationery and the work-related portion of the decline in value of a computer
• Claim the actual work-related portion of all running expenses, which needs to be calculated on a reasonable basis