Home sweet home office

Adrian Rasmussen • March 1, 2017

Making the most of home office deductions

Working flexible hours at home or running your small business from the spare room are becoming increasingly popular options for Australians. In August 2015, the Australian Bureau of Statistics estimated around 3.5 million of us were working from home, 59 per cent as employees and another 24 per cent as owner-managers of unincorporated enterprisesⁱ.

Although avoiding the daily commute sounds great, the growing cost of tax deductions for home office expenses means the ATO is keeping a much closer eye over these claims, so it’s worth ensuring you understand the rules.

Working from home

If you work from home part-time, you are only eligible to claim some of the costs of a home office. Deductions are available for running expenses and telephone costs related to your income earning activities and the depreciation of your office equipment.

Claimable running expenses include office equipment costing up to $300, or depreciation on items costing $300 or more. Other running costs include the cost of heating, cooling and lighting your home office and repairs to furniture or fittings. Cleaning and insurance costs related to the office space are also deductible.

The amount you can claim depends on how much time the equipment is used for work purposes. For example, if you use your computer for work 40 per cent of the time, you can only claim 40 per cent of the cost. Where the equipment is used for both personal and work-related purposes, you need to keep records (such as a diary over a sample month) to show how you estimated your usage.

Phone and internet claims

Telephone and internet expenses are also deductible, but claims can only relate to the business portion of each bill. If you are on-call or need to make regular calls to your employer or clients when away from your workplace, some of your phone rental may also be claimable.

Depreciation of office plant and equipment (such as computers, printers, desks and chairs) is another worthwhile deduction, but depreciation on curtains, carpets and light fittings can only be claimed if you have an area exclusively set aside for work purposes.

Employees are generally unable to claim occupancy expenses such as rent, mortgage interest, council rates and home insurance. When claiming home office deductions, receipts are required to substantiate large expenses, while a diary entry is enough for expenses under $10. The ATO has an online Home Office Expenses calculator to help you estimate the amount you can legitimately claim.

When head office is home

The rules are slightly different if your home is also your principal place of business. Where you have a separate space set aside for the business, you can claim deductions for both the running and occupancy costs.

Home-based businesses can deduct running costs such as electricity, gas and office equipment, but claims are only valid for the business portion of the expense. Self-employed taxpayers may be able to immediately write-off the cost of new equipment worth up to $20,000. Deductions are available for business phone costs such as rental and calls costs (but not installation fees), but must only be for the business portion of the bill.

Getting your deductions

Home-based businesses with a designated work area can also claim depreciation on their office plant and equipment, such as computers, printers, desks, chairs, curtains and carpets.

Occupancy costs such as rent, insurance, mortgage interest, repairs and rates can be claimed if your home is used as a place of business, such as a doctor’s surgery or if clients visit regularly. If your income includes personal services income, however, you may be ineligible.

It’s important to remember if you claim deductions for a home-based business you may lose some of your home’s ‘main residence exemption’ for capital gains tax (CGT), so you could be liable for CGT when you sell.

Call us if you would like more information about home office expenses or CGT issues.

i Characteristics of employment in Australia, August 2015, ABS, http://www.abs.gov.au/ausstats/abs@.nsf/mf/6333.0

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Do you know how your super is performing?

By Nikki Ashurst • November 2, 2026
Many Australians don't know how their super fund has performed or what it invests in. Are you one of them? Here's what to check and why it matters. Do you know how your super fund performed over the last two years? Many Australians don’t and are working towards their financial future without fully understanding one of their most important assets and without a clear plan for how their super may support them in retirement. That's not surprising, as many people view super as something that should run quietly in the background while they're busy with careers, families and everything else that life throws at them. But when you’re not sure what’s happening behind your balance, it’s harder to know whether you’re on track, whether your current approach reflects your goals or what opportunities might be available to help you make the most of what you’ve built so far. Your super isn't sitting in an account, it's invested Super is invested by a fund on your behalf across a mix of assets, with those investments working to grow your balance over time. Those include: Shares Ownership in Australian and international publicly listed companies. Their value can rise and fall, sometimes substantially over short periods but shares can provide capital growth over the long term. Property and infrastructure Real assets like office buildings, shopping centres, airports and energy networks. They can produce income and don't always behave in the same way as share markets, helping diversify investment holdings. Fixed interest and bonds Lending to governments and companies in return for interest. They can provide regular income and be steadier than shares, although returns and risk vary depending on the investment. Cash Generally, the most stable and lowest risk investment type. It can provide stability and faster access to money but typically offers lower longer term return potential. The investment option you choose determines the mix of assets held in your super based on your risk appetite. Most super funds offer options from conservative to high growth. If you’re young, a growth option with a higher exposure to growth assets like shares could offer higher returns over time – but it also comes with higher risk. As retirement nears, you might want to consider a more conservative approach with more defensive assets, like bonds for example to protect your savings. If you've never made a choice, you're probably in your fund's default option, which is designed to suit a broad membership. It’s worth knowing whether the mix you're in matches your circumstances and goals, including how far you are from retirement. Why performance alone is not a true comparison If you're thinking about how your super compares, returns are often where people start. The trouble is that a return figure means nothing without context: What it's being compared to Growth and conservative options invest differently and with different levels of risk. Compare like with like or the comparison may not be genuine. The comparison period A single year can be heavily influenced by short term market conditions. Super is measured in decades, so five, seven and ten year returns tell you far more about whether a fund is consistently doing its job, albeit not a predictor of future performance. Fees and tax Published returns should reflect investment fees, costs and tax but administration fees may be charged separately from your balance. Two funds quoting the same return can leave you in meaningfully different places once all fees are accounted for. Then there are the things that returns can't show you at all. For example, what insurance is attached to your account and what it's costing you, whether the fund offers guidance, tools and advice or simply sends a statement once a year. Another consideration maybe the level of support available when you need it. When comparing funds, it's worth looking at the full picture, including performance, fees, investment options, retirement support and member benefits. What today’s decisions mean tomorrow To understand how your super stacks up, start here: Find your investment option It's on your annual statement and in your online account. Look at what's in it Your fund publishes the asset allocation (shares, cash etc.) for each investment option. Check the long-term return for that option Focus on five and ten year returns, not just last year and compare them with equivalent options. Understand the total cost Add together administration fees, investment fees and insurance premiums as an annual dollar figure. Comparing super is about working out which option will perform best for you. Before you jump in, it’s worth understanding what's behind the numbers so you can make decisions based on more than a headline return. Knowing where you stand is the first step A super balance tells you where you are today. Understanding how your super is invested, how it compares and whether it's aligned with your goals helps show whether you're heading in the right direction. Source: MLC The information in this article does not take into account your objectives, needs and circumstances. We recommend that you obtain investment and taxation advice specific to your investment objectives, financial situation and particular needs before making any investment decision or acting on any of the information contained in this document. Subject to law, Capstone Financial Planning nor their directors, employees or authorised representatives gives any representation or warranty as to the reliability, accuracy or completeness of the information; or accepts any responsibility for any person acting, or refraining from acting, on the basis of the information contained in this document. Principal Wealth Management Pty Ltd trading as BMO Financial Solutions ABN 53 109 336 601 is a Corporate Authorised Representative (CAR 277821) of Capstone Financial Planning Pty Ltd ABN 24 093 733 969 Australian Financial Services Licence (AFSL) No. 223135.

The SMSF landscape is changing

By Jude Schofield • October 7, 2026
More Australians are choosing to take direct control of their retirement savings by establishing a self-managed super fund (SMSF) and according to the SMSF Association, Aussies now see their super as an important part of building and managing their overall wealth.