Tax return 2020: ATO extends 80 cents per hour working from home COVID deduction until September 30 – 7NEWS.com.au

Tax returns are expected to be a little different this year, with so many Australians now working from home due to coronavirus.
And when it comes to claiming expenses, quite a few methods are available – which is why the ATO introduced a temporary shortcut method for employees impacted by lockdowns.
In the video above: Tax time dos and donts for 2020
Now, theres good news – with the government revealing the simplified method is to be extended until September 30, 2020.
Workers can now use the shortcut method to claim 80 cents per hour for each hour you worked from home during the period between March 1 and September 30.
This means youll be able to make a claim on next years tax return if youre currently still based at home.
The shortcut method covers all work from home expenses.
That included phone and internet, the decline in value of equipment and furniture, and electricity and gas for heating, cooling and lighting.
However, those who choose to use this method will not be able to claim any other expenses for working from home.
You must also keep a record of the number of hours you have worked from home – whether its in the form of a timesheet, roster or a diary.
If youve had arrangements to work from home prior to COVID, youll still be able to use either of the two standard approaches to calculating home office expenses.
The first option is the fixed-rate method – which lets you claim 52 cents per hour on the costs of heating, cooling, lighting and the decline in the value of furniture.
This then allows you to make separate claims for the work-related proportion of your other costs such as home internet, mobile costs and stationery such as printer ink.
You must also have records of either your actual hours spent working at home for the year, or a diary for a representative four-week period to show your usual pattern of working at home.
Alternatively, there is the actual cost method – which will allow you to claim running costs such as:

• electricity and gas for cooling, heating and lighting
• decline in value of home office furniture (desk, chair) and furnishings,
• decline in value of phones, computers, laptops or similar devices
• phone expenses
• internet expenses
• cleaning (if you use a dedicated area for working)
• computer consumables and stationery such as ink

However, this requires more paperwork, as youll need to have kept all your original bills.
And aside from keeping a diary of your work hours, youll also need to work out the amount of floor area within your home thats being used as your home office space.
The actual cost method will generally give you a bigger claim compared to the fixed-rate or shortcut method.
But the calculations are more tedious – so its recommended to use a tax agent if you decide to go with the actual cost method.
For more information on how to calculate your work from home claims, visit the ATO website.
In the video below: How to ensure your home office space meets your needs
Here are the best ways to ensure your work from home space is meeting your needs and allowing you to stay focused and productive.

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