Private ruling: Home office expenses
Date of advice: 25 July 2018
Published: October 2018
Ruling period: Year ending 30 June 20XX
Date scheme commenced: 1 July 20XX

Ruling: Q1: Are you entitled to claim a deduction for a portion of rent and electricity as home office expenses? | A1: Yes Section 8-1 of the Income Tax Assessment Act 1997 (ITAA 1997) allows a deduction for all losses and outgoings to the extent to which they are incurred in gaining or producing assessable income or are necessarily incurred in carrying on a business for the purpose of gaining or producing assessable income except where the outgoings are of a capital, private or domestic nature. In your case your employer requires you to work from home as they don’t provide you with a place to work; therefore you have allocated a room in your unit as a home office. You use this office exclusively for work related to your employment. As a result you may claim apportioned expenses for occupancy and running costs for your home office. Further information on home office expenses can be found on our website ato.gov.au and entering Quick Code QC31977 into search bar at the top right of the page.

Relevant facts and circumstances: You work for xxxx. You undertake your work at home because your employer does not provide its employee’s a place to work in Australia. You have provided confirmation from your employer. You have provided a list of duties you perform in your home office. You rent a two bedroom unit at xxxx. You use one of the bedrooms as your home office. You share the unit with your partner but they do not use the home office. You have provided a plan of unit and calculated floor space dedicated to your home office as 17%. Your standard hours of work are 38 hours per week and you generally work from 9am to 5pm but may change depending on business requirements e.g. overseas calls, work priorities etc.

Relevant legislative provisions: Income Tax Assessment Act 1997 Section 8-1