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Home Office Expenses

Square Metre rate for Home Office Calculations 2023

The square metre rate for home office calculations has been set at $51.05 for the 2023 income year (1 April 2022 to 31 March 2023).

Home Office Expenses

If you’re a business owner and use part of your family home for work, you can make a claim for this as a business expense. In order to claim the expenses, there must be a connection between the use of your home and the business income being generated.

You can claim a portion of your household expenses, such as rates, insurance, power and mortgage interest. The portion you can claim relates to the area of your home that you use for business.

Companies Claiming Expenses for the Use of your Home

If your business is a company and does not pay anything towards the home office expenses, it cannot claim an expense.

However, if your company reimburses you for the use of your home, then it may be able to claim an expense. The company needs to be able to prove that there is a link between the money paid for the use of your home and the income the company makes. It also needs to keep accurate records that show how and when it paid for the use of your home, the amounts paid, and how it arrived at the amount to pay.

If you are a shareholder-employee/employee and the amount paid is a fair reimbursement for the use of your home, then it is exempt income and you do not need to pay income tax on the amount.

Splitting your Household Expenses

If part of your home is completely set aside for business use you just need to consider the floor area. If it is not completely set aside, you also need to consider the amount of time that part of your home is used for income-earning activities.

If you are registered for GST, the business expenses you claim will not include GST, when this applies. If you are not registered for GST, these expenses will include GST.

If you have a mortgage you can claim the same proportion of your mortgage interest (but not the principal) paid during the year. There is no GST involved in this.

For GST, you can claim a portion or percentage of the GST on the expenses.

Like you do for any other business expenses you are claiming, you need to keep invoices and other records for these expenses.

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