Tax Tip #14: Claim home-based business tax deductions

If you're running your business from home, either in full or in part, you may be eligible for a number of occupancy and operational/running expense deductions. Occupancy expenses such as rent, mortgage interest, insurance and rates can all be tax deductible, unless your business income includes personal services income, for example repair work or tutoring. More information on what qualifies as personal services income can be found on the ATO website.

Remember that occupancy expenses can also only be claimed if your home is your place of business and you have a separate home work area.

Other expenses that can be claimed are: gas, electricity, business phone costs, depreciation of office equipment (desks, computers) and depreciation of curtains, carpets and light fittings.

To help you easily claim these home-based business deductions during tax time, we recommend that you record each expense either physically or digitally for about four weeks per year in order to support your claims.

For expenses such as furniture depreciation, you can claim a fixed rate, according to the ATO, which minimises the need to keep a full record of individual expenses.

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