Working from home is one of the most claimed deductions in the country, and this tax time it is one of the most scrutinised. The rules are not new, but the ATO's patience with sloppy records has clearly run out.
How the fixed rate works
The fixed rate method pays 70 cents for every hour you worked from home in 2025-26. That single rate covers electricity, gas, phone, internet, stationery and consumables. You cannot claim any of those costs separately on top of it. Items like a desk, chair or monitor can still be claimed separately, either outright or as depreciation.
The part people miss
You need a record of the actual hours you worked from home across the whole year. A timesheet, a diary, a roster or a spreadsheet kept as you go all work. What does not work is an estimate, or a four week sample scaled up. If the ATO reviews your claim and you cannot show the hours, the deduction can be denied entirely.
Ask yourself one question
Could you hand the ATO a record for every hour you are claiming? If the honest answer is no, you have two options: claim the hours you can actually evidence, or use the actual cost method, which lets you claim your real expenses but demands even more paperwork, including bills and a record of your work use percentage.
Going forward
If your record keeping for 2025-26 was thin, start a fresh log this month for 2026-27. A recurring calendar note or a one line daily entry in a spreadsheet is enough, and future you will lodge with confidence instead of hope.