If you have been claiming phone expenses (mobile phone, home phone and internet expenses) as work-related deductions, the ATO now require additional evidence to substantiate these claims. If you want to claim more than $50 as a deduction, you need to keep a record for a consecutive period of 4 weeks. These can include diary entries, electronic records and bills. You will also need to provide evidence that your employer expects you to work at home or make work-related calls to prove that you are entitled to the deduction.
If you use your phone incidentally for work and intend to claim less than $50, you may make a claim based on the following, without having to analyse your bills:
If you want to claim more than $50, you will be required to calculate your percentage of work use based on the 4-week logbook.
A reasonable way to calculate would be as follows:
Claiming phone expenses: Bundled phone and internet plans
As these are often bundled together, you will need to apportion the costs based on your work use. Firstly, you will need to identify the value or how each service within the bundle costs.
Similarly to above, you will then apply the percentage of work use to each service. You can use the above formula to calculate the work use for your home phone.
A reasonable basis to calculate your work related use for internet would be as follows:
So even though the ATO have made it more onerous for taxpayers to claim certain deductions, we strongly encourage you to start – if you haven’t already – compiling your logbook (and please remember this has to be for 4 consecutive weeks) in order to maximise the amount of deductions you can claim on your tax return.
For more information, the ATO provide more detail on their website.
If you have any other questions or concerns, please don’t hesitate to contact our office at firstname.lastname@example.org or (07) 5539 4143.
Also read: Tackling your Tax Return