Working from home shortcut method

This method is temporary and can only be used to work out your deduction for work from home expenses:

between 1 March to 30 June 2020 in the 2019–20 income year
for the 2020–21 and 2021–22 income years.

The shortcut method ends on 30 June 2022. To continue to claim deductions for working from home expenses after 30 June 2022 you will need to use either the:

You will need to meet the eligibility and record-keeping requirements for the method you choose to use.

Eligibility

You can use this method if you:

worked from home and incurred some additional running expenses as a result
have a record of the number of hours you worked from home.

How it works

The temporary shortcut method simplifies how you calculate your deduction for working from home expenses.

Using this method, you:

can claim 80 cents per hour for each hour you work from home
can’t claim any other expenses for working from home, even if you bought new equipment.

The shortcut method covers all your working from home expenses, such as:

phone expenses
internet expenses
the decline in value of equipment and furniture
electricity and gas for heating, cooling and lighting.

The shortcut method includes decline in value of all items. If you choose to use this method there is no requirement to separately calculate the decline in value of equipment or depreciating assets or any other working from home expense.

However, as you may need to use a different method to work out your working from home deduction in later years it’s important to keep the:

receipts for depreciating assets or equipment you use when working from home
records of how you calculated your work-related use of the asset
your decline in value calculations.

Record keeping for the shortcut method

You must have a record of the hours you worked from home, for example, a timesheet, roster or diary.

Calculate your work from home deduction

Use the ATO’s Home office expenses calculator to help work out your deduction.

Completing your tax return

Once you calculate your deduction, enter the amount at ‘Other work-related expenses‘ in your tax return. Include in the description ‘COVID-19 hourly rate’.

The creation, trade and use of cryptocurrency is rapidly evolving.

If you invest in cryptocurrency, you may need to include a capital gain or loss in your tax return.

The term cryptocurrency is generally used to describe a digital asset in which encryption techniques are used to regulate the generation of additional units and verify transactions on a blockchain.

Cryptocurrency generally operates independently of a central bank, central authority or government. Any reference to ‘cryptocurrency’ in ATO guidance refers to Bitcoin, or other crypto or digital currencies that have similar characteristics as Bitcoin.

Everybody involved in acquiring or disposing of cryptocurrency needs to keep records in relation to their cryptocurrency transactions.

If you have dealt with a foreign exchange or cryptocurrency there may also be taxation consequences for your transactions in the foreign country.

Transacting with cryptocurrency

A capital gains tax (CGT) event occurs when you dispose of cryptocurrency. If you are involved in acquiring or disposing of cryptocurrency, there are tax consequences.

A disposal can occur when cryptocurrency is:

sold or gifted
traded or exchanged (including the disposal of one cryptocurrency for another)
converted to fiat currency (a currency established by government regulation or law such as Australian dollars), or
used to obtain goods or services.

If a capital gain is made on the disposal of cryptocurrency, some or all of the gain may be taxed. Certain capital gains or losses from disposing of a cryptocurrency that is a personal use asset are disregarded.

If the disposal is part of a business you carry on, the profits made on the disposal will be assessable as ordinary income and not as a capital gain.

While a digital wallet can contain different types of cryptocurrencies (bitcoin, etc) each cryptocurrency is a separate CGT asset.

Record keeping for cryptocurrency

It is vital to maintain accurate records for all cryptocurrency transactions, including if the cryptocurrency is being used as an investment, for personal use or in business:

transactions dates
cryptocurrency value in Australian dollars at the time of the transaction (which can be taken from a reputable online exchange)
transaction details i.e. what it was for and who the other party was

To accurately calculate your tax and meet your obligations, the typical records that should be kept include:

receipts of purchase or transfer of cryptocurrency
exchange records
records of agent, accountant and legal costs
digital wallet records and keys
software costs related to managing your tax affairs

More information

You can ask your accountant or use third-party software to help meet your record-keeping obligations and work out your tax. Get in touch with our Tax & Accounting team in Brookvale on 02 9981 2300 for advice and assistance.

Tag: records

Working From Home Temporary Shortcut Method Extended