If you have an internet service at home (or via your mobile phone), you paid for it, you used it for work purposes and you have the records to substantiate it you may be able to claim a tax deduction for it.
The key things you need to consider are:
- You will need to keep records for a 4-week representative period to help you decide how much of your costs relate to private usage and how much relates to work (if you are going to claim more than $50)
- You can only claim expenses for work related usage, not private usage
- Once you’ve estimated what percentage of your costs are related to work, just use this to calculate the proportion of your internet costs that you can claim as a deduction
- You can also record and claim any additional costs such as the costs of exceeding your download limit if this was related to your work
The Australian Taxation Office (ATO) has also announced special “short cut method” for claiming a tax deduction for working from home expenses due to COVID-19, If you use this method it includes internet expenses so you cannot also claim a specific deduction for internet expenses. If you use the other methods for calculating deductible work from home expenses, known as the “fixed rate method” and the “actual cost method”, you can claim separate amounts for internet expenses.
MoneyBrilliant can help you track your internet expenses as well as other tax-deductible expenses so you claim everything you are entitled to.
You can get more information on claiming deductions for internet costs from the ATO website or your tax adviser.
This summary has been prepared by MoneyBrilliant Pty Ltd (AFSL 492711). The information in this summary is of a factual nature only. We are not suggesting or recommending that you take any particular course of action in relation to any financial product or service. It does not take into account your personal circumstances or objectives. If you need financial advice or taxation advice you should seek advice from a licensed financial adviser or tax agent. You may also be able to access additional information from the websites of the Australian Securities and Investment Commission (ASIC) or the Australian Taxation Office.