Aussie remote workers get tax ‘shortcut’ bonus
Millions of Australians working remotely during the pandemic will be able to claim more back in their tax returns next financial year after the government extended the work-from-home tax shortcut for a second time.
In early April shortly after the Covid-19 crisis hit, the ATO introduced a new ‘shortcut’ method to calculating running home expenses which allows Aussies to claim 80 cents on every hour worked from home.
The temporary arrangement was only meant to be for hours worked from the beginning of March until 30 June, but was then extended to stretch until 30 September.
More on this topic: Everything you need to know about Tax Time 2020
Also read: 5 ways to supersize your tax refund
But Assistant Treasurer and Minister for Housing Michael Sukkar has now confirmed that the shortcut has been extended again to 31 December 2020.
“The short cut deduction method is making it easier for many Australians who are continuing to work from home due to Covid-19 when it comes to accurately completing their tax return,” he said on Thursday.
“This further extension will allow taxpayers working from home to continue to claim a rate of 80 cents per hour by keeping a record of the number of hours they have worked from home, rather than needing to calculate specific running expenses, until 31 December 2020.”
The other two methods of calculating home expenses, the fixed rate method and the actual cost method, are still available to taxpayers.
How does the ‘shortcut’ method actually work?
It’s straightforward: keep a record of your hours worked from home, and multiply that figure by $0.80. That’s the sum you’ll be able to claim in your tax return.
The ATO told Yahoo Finance that your hours could be logged as simply as keeping a personal spreadsheet.
When lodging your tax return, you claim these remote work expenses under ‘Other work-related deductions’.
There are just three ‘golden rules’ that all work-from-home claims need to follow:
You have to have spent the money yourself and not be reimbursed;
The claim must be directly related to earning income; and
There has to be some record of the purchase, such as a receipt.
Rolling coverage: For more Yahoo Finance stories on the 2020 Federal Budget, visit here.
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