New Fixed Rate – 70 Cents Per Hour

For the 2024–25 financial year, the Australian Taxation Office (ATO) has set a fixed rate of $0.70 per hour for individuals working from home.

This rate covers a range of home office expenses:

• Electricity and gas (heating, cooling, lighting)
• Phone and internet usage
• Office stationery
• Computer consumables (e.g. printer ink, paper)

It is important to note that these expenses cannot be claimed separately if you’re using the fixed rate method.

What the 70 Cents Actually Covers

Here’s where many people get caught off guard. That 70 cents per hour isn’t just for electricity or the heater under your desk.

Under the fixed rate method, the following are bundled together:

• Electricity and gas (for heating, cooling, lighting, and powering equipment)
• Phone and internet expenses
• Stationery and office supplies
• Computer consumables like printer ink and paper

You can’t claim these items again under any other part of your tax return. If you do, your return might be rejected, adjusted, or worse, flagged for review.

This method is convenient, but it’s also very specific in what it covers and allows.

What You Must Do to Claim

To claim this deduction properly, the ATO requires more than guesswork. Here’s what you need:

• Detailed records of your work-from-home hours
  (e.g. timesheets, rosters, diary logs)
• Proof of incurred costs, like an internet or utility bill

This method replaces the temporary “shortcut method” used during the COVID-19 pandemic.

The rules have changed and it’s important to keep up!

Example Scenario

If you worked from home:

• 2 days per week
• 8 hours per day
• For 48 weeks

That’s 768 hours x $0.70 = $537.60

A valuable deduction – if you’ve kept the proper records.

Avoid These Common Mistakes

❌ Guessing or estimating your work-from-home hours

❌ Trying to claim internet or electricity on top of the fixed rate

❌ Failing to keep receipts or bills as supporting documentation

These missteps could lead to an ATO review, rejected claims, or reduced refunds.

What You Can Still Claim Separately

Some work-related items are not included in the fixed rate and may still be claimed:

• Office furniture (e.g. desk, ergonomic chair)
• Equipment (e.g. monitor, webcam, noise-canceling headset)

These must be:

• Paid for out-of-pocket (not reimbursed by your employer)
• Depreciated over time according to ATO guidelines

Be Smart, Stay Prepared

The fixed rate method is convenient – but only if you use it correctly. Make sure you:

• Understand what the 70 cents per hour covers
• Keep detailed records of your hours worked
• Avoid double claiming