Working from home has its perks—flexible hours, no commute, and an endless supply of coffee. But when it comes to tax time, the ATO isn’t making it easy for you to claim what you’re entitled to.
With new record-keeping requirements and a fixed rate that might not be as generous as it seems, many taxpayers will miss out on home office deductions simply because they don’t have the right records.
So, what’s changed, what’s required, and most importantly, how do you make sure you’re getting every deduction possible without losing your sanity?
Let’s break it down.
So, what are your claim options these days for home office deductions?
If you work from home, you can still claim home office deductions on your expenses, but the way you do it has changed. The ATO offers two methods, each with its own pros and cons.
1️⃣ The Fixed Rate Method (67c per hour)
At first glance, the fixed rate method seems simple: for every hour you work from home, you can claim 67 cents, and you don’t need a dedicated area. This rate covers electricity, internet, phone use, and even stationery. Sounds great, right?
Well, not so fast.
The ATO now requires you to keep a detailed diary of all the hours you work from home – for every single day. No more estimates, no more “I usually work 40 hours a week” calculations. You need to record your actual hours in real time.
And if you thought that was the end of the admin nightmare, there’s more. Even though the 67c rate is supposed to cover expenses like electricity and internet, the ATO still expects you to keep all your receipts as proof of these costs.
It’s almost as if they want you to do all the work but get less of a deduction.
2️⃣ The Actual Cost Method
For those willing to do a little extra work, the actual cost method can lead to a much bigger tax reward. Instead of a flat rate, you claim a percentage of your actual home office expenses, including:
- Electricity and gas (calculated based on work-related use)
- Internet and data (portion used for work)
- Mobile and home phone (or fax if you’re holding on tight)
- Computer consumables (for example, printer ink)
- Stationary
This method often results in a higher claim, especially if you have significant work-from-home costs. However, it also means carefully tracking every expense, calculating percentages for work vs. personal use, and keeping a detailed record of all costs and receipts.
Why the ATO’s Fixed Rate Isn’t As Generous As It Sounds
At first glance, the new 67c per hour fixed rate might seem like a win. But let’s be honest – the ATO isn’t exactly in the business of handing out free money. In reality, many taxpayers are now worse off, thanks to a sneaky shift that reduces home office deductions while increasing paperwork.
Previously, you could claim home office deductions separately, often leading to a higher deduction. Now, the ATO has bundled everything together, ensuring you can’t claim key expenses individually – even though you still have to keep all the receipts.
And while they claim this new rate “simplifies” things, it actually drowns you in admin. The ATO now demands a detailed diary of every hour worked from home, plus proof of all bundled expenses – even though you’re not claiming them separately anymore.
Maximise Your Home Office Deductions with TaxTank’s New Home Office Diary
The ATO wants you to jump through hoops to claim your rightful home office deductions, hoping you’ll forget, mess up, or give up. But with TaxTank, you don’t have to play their game.
Instead of scrambling to maintain a work diary, manually tracking expenses, or worrying about choosing the right method, TaxTank does it all for you:
✔ Simple Hour Tracking – Quickly add your work hours in TaxTank’s Home Office Diary—no messy spreadsheets, just easy, ATO-compliant record-keeping.
✔ Seamless Expense Management – Bank feeds allow real-time tracking of work-related expenses, so you never lose a deduction.
✔ Smart Comparison – Automatically compares the Fixed Rate and Actual Cost methods, so you can see which gives you the best refund at tax time.
✔ ATO-Compliant Reports – With audit-proof records, you can claim every dollar you’re entitled to with complete confidence.
Final Thought: The ATO’s Secret Weapon is Forgetfulness
The ATO knows most taxpayers won’t keep a daily work-from-home diary, track every expense, or hold onto every bill. And that’s exactly how they win – by making the process so tedious that you give up before claiming what’s yours.
But with TaxTank, you don’t have to play their game. Easily log your hours, track expenses, and switch between methods to get the biggest refund possible, without the admin nightmare.
Your home office is real, your expenses are real, and your tax refund should be too. 💰
Take Control of Your Home Office Deductions Today!
Don’t let the ATO’s rules cost you money. With TaxTank’s Home Office Diary, you can track hours, manage expenses, and maximise your deductions without the admin headache.
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