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    15 Tax Things All Aussies Should Consider If They've Been WFH Due To COVID-19

    Including whether or not you can actually claim your rent as a tax deduction.

    Like many Aussies, I've been working from home for a few months due to COVID-19.

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    And now that we're into a new financial year, I've been wondering how this is going to affect my individual tax return.

    To get some answers, I spoke to Helen Baker, financial planner and spokesperson for money.com.au, about what kind of tax deductions I can claim since I've been WFH due to COVID-19.

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    Here are 15 things she suggests keeping in mind when putting together your 2019/20 individual tax return.

    1. Firstly, you have to figure out which method of COVID-19 claims work best for your personal situation.

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    "There are three different ways to calculate your claims," says Helen, "the special COVID-19 shortcut method, the fixed rate method and the actual cost method."

    "I'd imagine the shortcut method will be most applicable for those who have had to work from home due to COVID-19."

    2. If you opt for the shortcut method, you can claim 80 cents for every hour of work that you've done from home between 1 March 2020 – 30 June 2020.

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    This method is only applicable if you are are working from home to fulfil your employment duties β€” and not just doing occasional tasks, like checking emails β€” and covers all additional deductible running expenses, including your utility, phone and internet bills.

    "This method is by far the easiest to employ," says Baker, "as you don't have to keep any records of your expenses or usage."

    3. However, it might be more financially worthwhile to calculate and claim back the costs you've incurred.

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    If your job requires you to use larger quantities of specific resources, or you have to purchase anything specific to do your job, the fixed rate method lets you claim 52 cents for every hour you've worked from home β€” which is different from the shortcut method, as you can claim the cost of things like your phone bill, internet usage and stationary on top of that 52 cents per hour β€” while the the actual cost method might be better for those who have to buy big, one-off work expenses, like specialised computer hardware.

    "It's a good idea to calculate your costs using all the different methods to see which one gives you the most cash back," says Baker.

    4. In order to calculate your costs accurately, you'll need to have kept a log book recording all the costs you've incurred β€” as well as any relevant bills or receipts β€” for a minimum of four weeks.

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    "Logging for a month gives you a pretty good indication of your general costs, which can then be applied to the three months you've been working from home" says Baker.

    "This might not be applicable for the 2019/20 financial year, but might be worthwhile for those continuing to work from home in the 2020/21 financial year."

    5. While you can definitely claim work expenses on your tax return, you're often better off getting your company to reimburse you for certain expenses.

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    "If your company agrees to cover certain expenses to offset you working from home, you'll actually end up financially better off," says Baker. "When you claim expenses on your tax, depending on your tax bracket, you might only recuperate a portion of the real cost of that expense β€” whereas if your company pays for it, you'll recuperate 100% of the cost."

    6. For those in client-facing positions, you might be able to get your employer to cover the cost of your phone bill.

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    "This could be by way of a flat β€˜disbursement’ fee of, say, $50-100 a month, which is easy for both you and your employer," comments Baker, "Or your employer might ask you to provide itemised costs, whereby you will need to show your employer your bills each month with work separated from personal costs."

    7. But if you're claiming calls as a tax deduction, consider if the actual cost method is most appropriate for you.

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    "You must also keep a record of itemised work call costs. For those only using their phone for work occasionally, the shortcut or fixed-rate method for claiming a tax deduction may be more appropriate for you."

    8. Your boss might also be up to foot the bill for any upgrades to your internet and mobile data plans...

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    "You could ask your employer to reimburse you for these costs if you can show that you had to go on a higher-cost plan to enable you to work from home effectively," says Baker. "If you have not upgraded your plans, you can still claim a portion of your internet and mobile data costs as a part of the shortcut, fixed-rate or actual cost method."

    9. ...as well as hardware such as a laptop, cables, a mouse and stationery.

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    "If you were required to purchase essential hardware to carry out your job at home – and those items will not be for personal long-term use – ask your employer if they will reimburse you for the expense," says Baker.

    "However, your employer is unlikely to reimburse you for items they deem non-essential or for personal use β€” which may or may not include a second PC monitor or printer ink, if other family members are also using the printer."

    10. They should also cover software subscriptions that you need to fulfil the duties of your job.

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    If you had to purchase software for a work-owned computer or laptop, ask your employer to reimburse you. Similarly, if the software was installed on a home computer for the sole purpose of work, you could request reimbursement.

    11. However, it's unlikely that they'll cover specific furniture that you need for your home office set up.

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    "Many employees were unlikely to have had a home-office setup when they were asked to work from home," says Baker. "If this was you, you might have had to purchase a desk and chair. Your employer may not reimburse you for these as it is likely you will continue using the furniture at home when you re-enter the workplace β€” so your alternative is to claim as a tax deduction."

    "However, some professions require specific furniture to fulfil the duties of their jobs β€” like how architects require specific desks, for example...If you are using the actual cost method and the assets cost less than $300, you can get an immediate deduction for the depreciating asset."

    12. As your home now doubles as your workplace, you might be questioning whether your rent is tax deductible β€” and that depends on the conditions of your employment...

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    "Sole traders and remote workers who have had working from home arrangements in place since before COVID-19 may be able to claim a portion of their rent as work expenses," says Baker, "but occupancy expenses relating to your home – such as rent, mortgage interest, property insurance and land taxes – will not become tax deductible just because you've had to temporarily work from home due to COVID-19."

    13. ...which is similar for electricity and other utilities.

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    "Heating, cooling and lighting are covered under the shortcut method and fixed-rate method for tax deductions," comments Baker. "Your employer is unlikely to agree to a reimbursement, as it is difficult to determine what proportion of your bills was incurred for work use, particularly if there are multiple people in your household."

    14. Be aware that your employer might not cover travel and parking costs that you incurred to pick up any of your things from the office.

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    "Travel to and from the office is not tax deductible, so seek advice from an accountant regarding your home being the 'new office'," says Baker.

    "If you had to regularly get the mail for your employer, or pick up work parcels, these costs may be tax deductible for the public transport ticket and the kilometres travelled by car, depending on the journey."

    15. And any of your late-night meal reimbursements may not be applicable since you've been working from home.

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    "Your employer might have provided coffee, tea and milk in the office, as well as takeaway dinners if you had to work late, but this would have been out of goodwill," comments Baker.

    "While you are working from home, however, your employer is very unlikely to cover this expense β€” nor can you claim these general household items as a tax deduction. This is because you are presumably at home and are able to cook your meal."

    Aussies, do you have any other questions or tips about your 2019/20 tax returns? Drop them in the comments below!

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