Home based business

Learn about what home expenses you may be able to claim for running your business.

Key points

  • If you are running your business from home, you may be able to claim some of your costs as a tax deduction.
  • The types of expenses you can claim depend on how you operate your business out of your home.
  • You can only claim deductions for the portion of your expenses that relate to running your business.
  • If you sell your home, there may be capital gains tax (CGT) implications.

Running expenses

You can claim running expenses if you run your business from home, such as in a separate study or a desk in a lounge room, even if it doesn’t have the character of a ‘place of business’.
Running expenses are the increased costs from using your home's facilities for your business and may include:
  • the costs of using a room (such as heating, cooling and lighting)
  • cleaning costs
  • landline phone and internet costs
  • decline in value (depreciation) of your business furniture and equipment
  • costs of repairs to your business equipment.

Occupancy expenses

Occupancy expenses are the expenses that you pay to own or rent your home and may include:
  • mortgage interest or rent
  • council rates
  • land taxes
  • house and contents insurance
You can only claim occupancy expenses if the area of your house set aside for your business has the character of a ‘place of business'. Indicators that the area of your home that you’ve set aside is a place of business include:
  • clearly identifiable as a place of business
  • not readily suitable for private use
  • exclusively used for business purposes
  • regularly used for visits by your customers

Trusts and companies

If you are operating your business as a trust or company you will need a genuine, market-rate rental contract to cover which expenses the business pays for. Your accountant can help you with this.

ATO factsheet

Are you looking for some help with your record keeping?

Would you like to:
  • Save time on your record keeping so you have more time to focus on other aspects of your business?
  • Reduce the stress around meeting your GST and payroll reporting obligations?
  • Have reliable data and reports to help you to understand how your business is performing, manage your cash flow, make more informed decisions and improve your business?
I’m Sharon, a registered BAS agent with more than 20 years' experience in the industry.Get in touch to find out how I can support you and your business to stay on top of your numbers to run a successful business.
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