Claiming Home Telephone Expenses

Can I Claim My Home Telephone?

Yes, you can....with remote work and home-based businesses, your home telephone can be an essential tool for earning income. But can you claim these expenses on your tax return? Yes, you can, provided you follow the Australian Taxation Office (ATO) guidelines and accurately determine the work-related portion of your telephone usage.

Understanding the Basics

The ATO allows you to claim deductions for home telephone expenses if they are directly related to earning your income. This applies to employees working from home, small business owners, and freelancers. The key is to accurately determine and substantiate the work-related portion of your telephone usage.

Methods for Claiming Telephone Expenses

There are two primary methods for claiming home telephone expenses:

1. Actual Expenses Method: This method involves calculating the exact work-related portion of your telephone usage. You'll need to keep detailed records, including telephone bills and a logbook of your work-related calls over a representative period (usually four weeks). This method can be more time-consuming but may result in a higher deduction if your work-related usage is significant.

2. Fixed-Rate Method: This method allows you to claim a fixed rate per hour for each hour you work from home, covering all additional running expenses, including telephone. To use this method, you must keep a record of the hours you work from home.  Gotax does the calculations for you.

Record Keeping and Log Books

Accurate record-keeping is essential to substantiate your claims. Here are some tips:

• Log Book: Maintain a logbook for at least four weeks, recording the time spent on work-related telephone calls. This logbook will help you determine the percentage of your telephone usage that is work-related.
• Bills and Receipts: Keep copies of your telephone bills and highlight the relevant portions that relate to your work.
• Diary Entries: If you use the fixed-rate method, keep a diary of the hours you work from home.

Example Scenario

Imagine you work from home and use your home telephone for both personal and work purposes. After maintaining a logbook for four weeks, you determine that 40% of your telephone usage is work-related. If your monthly telephone bill is $50, you can claim $20 per month as a work-related expense using the actual expenses method.

Gotax Deduction Grabber App

To make record-keeping even easier, consider using the Gotax Deduction Grabber App. This app provides all the logbooks and tax expense recording systems you need in one place. Simply scan the QR code to download and streamline your tax deduction process.  Go top www.deductiongrabber.com.au.

Gotax Tip of the Day

Maximise your tax refund by maintaining accurate records and choosing the method that best suits your work situation. Remember, every deduction counts!

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