ATO Targets Home Office Claims & Real Estate Deductions
ATO Targets Home Office Claims & Real Estate Deductions
1
The information on this website is general in nature and does not take into account your objectives, financial situation, or needs. Consider seeking personal advice from a licensed adviser before acting on any information.
Australian residents are being alerted to tighten up their tax return filing, particularly with the deductions claimed for home offices and rental property expenses, as the Australian Tax Office (ATO) sharpens its scrutiny on such declarations.
The ATO has flagged three areas of concern where errors frequently occur: erroneous work-related deductions, amplified claims on rental properties, and omissions in declared income. Assistant Commissioner Rob Thomson emphasizes that even though some inaccuracies are not deliberate, taxpayers should be extra cautious to avoid penalties.
In the last tax season, above eight million Australians lodged work-related expenses, with a significant portion being for home office use. The ATO has revised the way it calculates home office expenses, introducing a new fixed rate and specifying what qualifies for deduction. Clear and detailed documentation to support claims is now mandatory, including records of hours worked from home and associated expenditures such as utility bills.
"If you plan to replicate last year’s home office deduction without the proper documentation, be prepared for a follow-up from us," warns Thomson. He insists that to prevent disqualification, taxpayers must ensure they follow three critical rules: personal expenses must be incurred without reimbursement, the expense should be tied to income generation, and tangible evidence like a receipt is necessary to validate the claim.
Concerning rental property owners, the ATO reports widespread discrepancies in tax returns, with many landlords wrongly logging their income tax. Maintenance and repair claims are a particular focus, with Thomson advising against exaggerating these to compensate for higher rental incomes. Legitimate immediate deductions include routine repairs; however, initial restorations or improvements like kitchen renovations fall under capital works and are deductible over time.
Thomson encourages property owners to thoroughly review their documentation before submitting their tax returns, and if needed, consult a registered tax agent for accurate deduction filings.
To ensure the accuracy of their tax filings, Thomson advocates Australians to avoid hurrying their tax return submissions at the beginning of July. He notes that errors often stem from rushing and neglecting to include all sources of income such as bank interest, dividends, and additional government payments. Taxpayers are advised to wait until pre-filled data is available, ensuring completeness and reducing the likelihood of amendments post-submission.
"While many are eager to check off their tax return early, exercising a bit of patience can be the key to getting your tax return right. Confirm that your employment income statement has been finalized and that your pre-filled information is comprehensive in myTax before lodging," Thomson concludes.
Published:Monday, 6th May 2024 Source: Paige Estritori
Please Note: If this information affects you, seek advice from a licensed professional.
Commonwealth Bank of Australia (CBA), the nation's largest bank by market value, has reported a modest increase in its first-quarter cash profit for 2025. This uptick is primarily attributed to robust growth in home loans and household deposits. The unaudited cash profit stands at approximately A$2.6 billion, marking a 1% rise from the previous two-quarter average and a 2% increase compared to the same period last year. - read more
Australia's leading banks-Commonwealth Bank of Australia (CBA), Westpac, National Australia Bank (NAB), and ANZ-are actively reducing their dependence on mortgage brokers. This strategic shift aims to bolster profit margins that have been under pressure due to lower interest rates, rising operational costs, and intense market competition. - read more
In November 2025, Australian consumer sentiment has turned optimistic for the first time since early 2022, marking a significant shift in public economic perception. The Westpac-Melbourne Institute survey indicates a 12.8% increase in the consumer sentiment index, reaching 103.8. A reading above 100 suggests that more consumers are optimistic than pessimistic. - read more
Loan Market Group's (LMG) Asset Finance Exchange (AFX) has achieved approximately $80 million in settlements within its inaugural year, underscoring the robust growth of Australia's asset finance market. The platform connects mortgage brokers with asset finance specialists, facilitating streamlined access to asset finance solutions. - read more
National Australia Bank (NAB) has reported a cash profit of A$7.09 billion (US$4.6 billion) for the year ending September 30, 2025, reflecting a stable financial performance. Despite this, CEO Andrew Irvine has identified the housing crisis as Australia's most pressing societal and policy challenge, advocating for expedited decision-making to stimulate economic growth and enhance housing availability. - read more
Welcome to our blog, where we're dedicated to helping you make the most of your financial journey. Today, we're going to delve into an important aspect of financial health: tracking your progress after debt consolidation. - read more
Welcome, readers! We're here to talk about something incredibly important yet often overlooked: improving your credit score. Your credit score is a financial report card used to evaluate your creditworthiness, and it can have a significant impact on your ability to secure loans, mortgages, and even rental agreements. - read more
Managing debt is a crucial aspect of maintaining financial well-being, yet it can often feel like a daunting task. Understanding how debt works and its potential impact on your life is the first step toward gaining control of your finances. In this section, we will delve into the intricacies of debt and outline why a solid financial strategy is essential for effective debt management. - read more
Welcome to our comprehensive guide where we aim to debunk common myths surrounding debt consolidation and debt reduction. This blog post serves as a beacon of clarity for those who find themselves navigating through the choppy waters of financial jargon and conflicting information. - read more
Welcome to our guide on how to avoid falling back into debt after consolidating your debts. Debt consolidation can be a fantastic way to manage multiple financial obligations, combining them into a single, more manageable payment plan. But the journey doesn’t end there. - read more
