Claiming Mobile Phone, Internet and Home Phone Expenses by Clarke McEwan Accountants

The Australian Taxation Office now generally requires many taxpayers making such claims to keep a 4-week diary. If you use your own phones or internet for work purposes, you may be able to claim a deduction if you paid for these costs and have records to support your claims.

If you use your phones or internet for both work and private use, you will need to work out the percentage that reasonably relates to your work use. If your employer provides you with a phone for work use and is billed for the usage (phone calls, text messages, data) then you are not able to claim a deduction. Similarly, if you pay for your usage and are subsequently reimbursed by your employer, you are not able to claim a deduction. If you use your own phones or internet for work purposes, you need to keep records for a 4-week representative period in each income year to claim a deduction of more than $50. These records may include diary entries, including electronic records, and bills.

Evidence that your employer expects you to work at home or make some work-related calls will also help you demonstrate that you are entitled to a deduction. As there are many different types of plans available you will need to determine your work use using a reasonable basis.

INCIDENTAL USE If your work use is incidental and you are not claiming a deduction of more than $50 in total, you may make a claim based on the following, without having to analyse your bills:

• $0.25 for work calls made from your landline,
• $0.75 for work calls made from your mobile, and
• $0.10 for text messages sent from your mobile.

USAGE IS ITEMISED ON YOUR BILLS If you have a phone plan where you receive an itemised bill, you need to determine your percentage of work use over a 4-week representative period which can then be applied to the full year. You need to work out the percentage using a reasonable basis. This could include:

• the number of work calls made as a percentage of total calls.
• the amount of time spent on work calls as a percentage of your total calls.
• the amount of data downloaded for work purposes as a percentage of your total downloads. 

USAGE IS NOT ITEMISED ON YOUR BILLS If you have a phone plan where you don't receive an itemised bill, you determine your work use by keeping a record of all your calls over a 4-week representative period and then calculate your claim using a reasonable basis.   

BUNDLED PHONE AND INTERNET PLANS Phone and internet services are often bundled. When you are claiming deductions for work-related use of one or more services, you need to apportion your costs based on your work use for each service. If other members in your household also use the service, you need to take into account their use in your calculation. If you have a bundled plan, you need to identify your work use for each service over a 4-week representative period during the income year. This will allow you to determine your pattern of work use which can then be applied to the full year. A reasonable basis to work out your work related use could include:

Internet:

• the amount of data downloaded for work as a percentage of the total data downloaded by all members of your household.
• any additional costs incurred as a result of your work related use – for example, if your work-related use results in you exceeding your monthly cap.

Phone:

• the number of work calls made as a percentage of total calls.
• the amount of time spent on work calls as a percentage of your total calls.
• any additional costs incurred as a result of your work related calls – for example, if your work-related use results in you exceeding your monthly cap.

If you have any questions in relation to calculating claims for the above expenses please contact our office  and we can review your particular situation.