Private ruling: Deductions work related
Date of advice: 8 November 2023
Published: 18 December 2023
Ruling period: Year ended 30 June 2023
Date scheme commenced: 1 July 2022

Ruling: Q1: Can you claim a deduction for the occupancy expenses in relation to that portion of your home that is used for employment purposes under section 8-1 of the Income Tax Assessment Act 1997 (ITAA 1997)? | A1: Yes. Taxation Ruling TR 93/30 Income tax: deductions for home office expenses considers when occupancy expenses are deductible under section 8-1 of the ITAA 1997, due to the absence of an alternative place for conducting income producing activities. Paragraph 13 lists reasons that all must exist for such a deduction to be allowable, including that your circumstances are such that there is no alternative place of business, and it was necessary to work from home. Based on the principles outlined in TR 93/30, we consider that part of your home is a 'place of business' as there is no suitable alternative for you to work at your head office, it is necessary for you to work at home and that area of the home is used exclusively for income producing purposes. Subsequently, you can claim deductions under section 8-1 of the ITAA 1997 for occupancy expenses for your home office. Home office expenses need to be apportioned by floor area of the dwelling.

Relevant facts and circumstances: You are employed in a professional capacity. You have been working from home for a number of years as your employer does not maintain a physical office. Working remotely is part of your position description and you are expected to operate remotely as part of your normal employment duties. You pay rent for your current residence. You have dedicated a specific room to carrying out your duties. The workspace includes a desk, chair and computers. The office room is a small percentage of the dwelling. The room is 100% used for work, is not used for normal living purposes and is locked when not being used for work purposes.

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