WHAT CAN I DO AS AN INDIVIDUAL?

Click here to access the Individuals Checklist

We are obviously entering into unchartered territory in unprecedented times and drastic action will need to be taken.

At Vision Consulting Group we will do everything we can to support you through these difficult times and help you navigate anything that comes up to ensure you are in the strongest position possible on the other side of this health crisis.

We have created a summary of action items that you need to take immediately to ensure you are preparing early. 

Should you need any assistance, please do not hesitate to contact our team.

EMPLOYEES WORKING FROM HOME

If you’re an employee who regularly works from home, you may be able to claim a deduction for expenses relating to that work.

  • Running Expenses: Employees who work from home can claim the work-related proportion of their running expenses. These expenses are the cost of using equipment and utilities at your home for work and include:
    • Lighting.
    • Heating and Cooling.
    • Cleaning.
    • The decline in value of equipment, furniture and furnishings in the area you use for work.
    • The cost of repairs to this equipment, furniture and furnishings, and
    • Other running expenses including computer consumables (such as printer paper, ink) and stationary. 
  • Occupancy Expenses: As an employee, generally you can’t claim a deduction for occupancy expenses, which include rent, mortgage interest, property insurance, land taxes and rates. For more information, click here.
  • Phone and Internet Expenses: if you use your phone or internet for work, you can claim a deduction for the work-related percentage of your expenses if you paid for these costs and have records to support your claims. 
    • You need to keep records for a four-week representative period in each income year to claim a deduction of more than $50. These records include phone bills (paper or electronic) from which you can identify work-related calls. Diary entries and evidence that your employer expects you to work at home or make some work-related calls will also help you demonstrate that you are entitled to a deduction.

CALCULATING RUNNING EXPENSES

There are two ways to calculate your running expenses:

       You can claim a fixed rate of 52 cents per hour, or
       You can calculate your actual expenses. 

  • FIXED RATE : You can use a fixed rate of 52 cents per hour for each hour that you work from home. This method incorporates all the items you are able to claim, including the decline in value of office furniture and furnishings (such as desk and chair).
    • You can keep a diary that documents your pattern of office use for a minimum of four weeks in a financial year. The diary should outline the actual hours you spent working at home. You can then apply this amount of use across the remainder of the year to determine your full claim.
  • ACTUAL EXPENSES: To calculate actual expenses if you have a dedicated work area, you:
    • Record the total expenses for lighting, cleaning, heating, cooling and electricity for any depreciating assets used for your home for the year.
    • Work out the floor area of the part of your home that you use for work as a percentage of the total floor area.
    • Work out the percentage of the year you used that part of your home exclusively for work – eg if you used it for work for six months during the year, the percentage would be 50% (note: in working this out you must also take into account the use of that area by other members of your household if applicable). Apply this percentage to your calculation above to determine the amount you can claim.

If you did not have a dedicated work area, the additional expense for lighting, heating, cooling and electricity should be calculated by determining the actual cost of running each unit you used per hour and multiplying that by the hours you spent working at home. Generally, the amount of additional expense will be small. This will be particularly so where other people are using the area at the same time you are working there. In those circumstances there will be no additional cost for lighting, heating or cooling.

You can calculate your deductions for decline in value by working out the amount of depreciation for each item for the year, and claiming the proportion of the amount which reflects your work-related use. The ATO has a depreciation tool to help you work this out.

 

CALCULATING PHONE AND INTERNET EXPENSES

There are two ways to calculate your running expenses:

      You can claim up to $50 with limited documentation, or
      You can calculate your actual expenses. 

  • CLAIMING UP TO $50: If your work use is incidental and you are not claiming a deduction of more than $50 in total, you may make a claim based on the following, without having to analyse your bills:
    • $0.25 for work calls made from your landline.
    • $0.75 for work calls made from your mobile.
    • $0.10 for text messages sent from your mobile. 
  • ACTUAL EXPENSES: f you have a phone or internet plan where you receive an itemised bill, you need to determine your percentage of work use over a four-week representative period which can then be applied to the full year. You need to work out the percentage using a reasonable basis. This could include:
    • The number of work calls made as a percentage of total calls.
    • The amount of time spent on work calls as a percentage of your total calls.
    • The amount of data downloaded for work purposes as a percentage of your total downloads.

f you have a bundled or non-itemised plan, you need to identify your work use for each service over a four-week representative period during the income year, which can then be applied to the full year.

For more information, click here. 

RECORDS YOU MUST KEEP

There are two ways to calculate your running expenses:

  • Receipts or other written evidence, including for depreciating assets you have purchased.
  • Diary entries to record your small expenses ($10 or less) totalling no more than $200, or expenses you cannot get any kind of evidence for.
  • Itemised phone accounts from which you can identify work-related calls, or other records, such as diary entries, if you do not get an itemised bill.

TO AVOID THE SPREAD OF COVID-19

  • Wash your hands frequently

  • Cover your cough or sneeze

  • Avoid close contact with others; at least 6 feet – especially when you’re with or around vulnerable groups such as the elderly, people with chronic medical conditions etc

  • No handshakes, try not to touch your face, sanitiser your hands and clean surfaces

  • Isolate yourself at the first sign of any symptoms until you can be tested- There’s a hotline (1800 020 080) if you have any questions or need to seek professional help to answer questions.

  • Think different- change your ways of doing things. Can you shop online for food and clothes? Phone a friend instead of meeting up, watch a movie on Netflix instead of going to the cinemas, do work meetings through Zoom etc.

We hope that this document will give all of you clarity on what is currently happening and some suggestions on what to do and where to go next. 

Regards, 

Nino Italiano 9387 6444

GET IN TOUCH WITH US FOR MORE INFORMATION

(03) 9387 6444

(03) 9387 6555

info@visions.com.au

55 Pelham Street, Carlton, Vic 3053, Australia

  • (03) 9387 6444
  • (03) 9387 6555​
  • info@visions.com.au
  • 55 Pelham Street, Carlton, Vic 3053, Australia

©VISION CONSULTING GROUP 2019
ALL RIGHTS RESERVED.

©VISION CONSULTING GROUP 2019
ALL RIGHTS RESERVED.