Remote Working and Deductible Office Expenses in Australia

With so many opportunities to work remotely due to COVID-19 many organizations are being required to make a quick pivot in order to support employees who are working outside of the traditional workspace. Organizations in Australia are now looking at the long-term viability of keeping employees working remotely in order to decrease operational expenses and overhead. This then generates the question, how can employees working from home continually be supported by their organizations?
The Australian Taxation Office (ATO) has created short-cuts for employers and workers in order to deduct certain home office expenses. For example, employees may deduct a rate of 52 cents per hour for operating costs in addition to $50 per year for work related phone and Internet costs. Additionally, due to COVID-19, the rate of deduction for work completed at home has been increased to 80 cents per hour at least until June 30th, 2020, with the option to extend if deemed necessary.

There are also a number of pieces of equipment that can be deducted if a variety of eligibility requirements are met. For example, based on requirements developed by the ATO, equipment deductions may be made if the equipment is less than $300 and if you use the item specifically for work for a minimum of 50% of your work time. Additionally, employees working from home may deduct some utility payments if the employee has a specific home office or room where you dedicate to working alone.

Overall, organizations are beginning to see the potential for extraordinary cost savings by reducing the amount of physical workspace necessary. Organizations that did not traditionally have employees engaged in remote working arrangements are beginning to see the opportunities remote working, or teleworking, can provide the company as a whole. It was also usually expected that employees would be less productive if they had to work from home; however, organizations are finding many employees enjoy this set up.

Without a doubt, the COVID-19 pandemic created a necessity for many unwilling workplaces to try out some remote working arrangements for their employees. Now that these organizations have had no choice but to implement remote working procedures, there is a strong likelihood that they will remain in place for the long haul.

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