The 70c Work-From-Home Method: How to Claim It Right on Your 2026 Return
Claiming working from home on your 2025-26 return? The ATO's 70c fixed rate is the easy option — here's what it covers, what it doesn't, and the trap that gets people caught.
If you did any work from the couch, the spare room or the kitchen table last financial year, there's a deduction with your name on it. The Australian Taxation Office (ATO) lets you claim a flat 70 cents for every hour you worked from home in 2025-26 — no adding up power bills, no calculator gymnastics.
It's called the fixed rate method, and it's the easiest deduction most PAYG (pay-as-you-go, the tax taken straight from your wages) earners will ever claim. But it comes with a couple of rules that trip people up every tax time — and one of them is a fast track to an ATO please-explain. Here's the plain-English version so you claim it right the first time.
What the 70c rate actually covers
Think of 70 cents an hour as an all-in bundle for the everyday running costs of working from home. Claim the rate and you've already claimed all of this — you can't also add these bills up separately:
- Electricity and gas (the energy to run your lights, heating and cooling)
- Internet and home data
- Your mobile and home phone use
- Stationery and computer consumables (the stuff you use up — paper, ink, printer cartridges)
🪑It's a running-costs bundle, not everything
The 70c rate only covers the running costs above. Bigger one-off gear — a desk, an office chair, a monitor, a laptop — sits outside the rate and is claimed separately (more on that below). Different costs, so it isn't double-dipping.
A worked example: what an hours log is worth
Say your diary shows 700 hours worked from home across the year — that's roughly two days a week once you take out leave and public holidays. The maths is simple:
700 hours x 70c = a $490 deduction.
Here's the part people misread: a $490 deduction is not $490 back in your pocket. A deduction comes off the income you get taxed on, so it's worth your marginal tax rate. On a $75,000 salary you're in the 30% bracket for 2025-26, so that $490 knocks about $147 off your income tax, plus roughly $10 in Medicare levy — around $157 back. Still a tidy return for keeping a timesheet.
🧮A deduction isn't a refund of what you spent
It reduces your taxable income, and the benefit is that amount times your marginal rate. A $490 work-from-home claim is worth about $157 to someone in the 30% bracket — not $490. Pop your income into our Tax Calculator to see your own marginal rate.
What you can still claim on top
The 70c rate stops at running costs. The bigger equipment you bought to work from home is claimed separately, on top of the rate — and that's not double-dipping, because they're genuinely different costs:
- Decline in value (depreciation — the drop in an item's value as it ages) of a desk, office chair, monitor or laptop
- Repairs and maintenance on that work equipment
- The cleaning cost of a dedicated home office, if you have a separate room set aside for work
💻The laptop rule
Bought a $900 laptop you use mostly for work? Its depreciation is claimable on top of the 70c rate. Items that cost $300 or less can usually be claimed in full straight away; more expensive gear is claimed as it declines in value over a few years.
The trap that gets people caught
The single most common mistake on a work-from-home return is claiming the 70c rate and then also claiming your internet or phone bill somewhere else in the return. The rate already includes them. Claim both and you've claimed the same cost twice — and the ATO's data-matching flags this pattern on work-from-home returns every year.
There's a legitimate way to claim your actual bills: the actual cost method. Instead of 70c an hour, you work out the real work-related slice of every cost (say, the work percentage of your electricity, internet and phone). It's more paperwork and needs receipts, but for people with a dedicated office and chunky bills it can beat the fixed rate. The golden rule: you pick one method for the year — never both for the same costs.
🚨One method, not two
70c per hour OR your actual bills — never the rate plus your internet and phone on top. That double-dip is one of the first things the ATO's systems look for on a work-from-home claim.
The records the ATO now wants
The rules tightened a couple of years back, and the biggest change is about your hours. The ATO no longer accepts a guess or a four-week sample stretched across the year. To use the 70c rate for 2025-26 you need:
- A record of the actual hours you worked from home for the whole year — a timesheet, roster, or a diary you kept as you went (an estimate won't do)
- At least one bill for each running cost the rate covers — for example, one electricity bill and one phone bill — to show you actually incurred the cost
✅You don't need a home office
A common myth is that you need a separate study to use the 70c rate. You don't — the kitchen table counts. You do need to be genuinely working (doing your real job), not just checking the odd email or taking a quick call after hours.
FAQ
What is the working-from-home fixed rate for 2025-26?
70 cents for every hour you worked from home. It rose from 67c to 70c on 1 July 2024 and is unchanged for the 2025-26 year, which is the return most people are lodging now.
Can I claim my internet and phone on top of the 70c rate?
No. The 70c rate already includes electricity, gas, internet, phone, stationery and consumables. Claiming any of those separately as well is double-dipping. If you want to claim your actual bills, you'd use the actual cost method instead — but then you don't use the 70c rate.
Can I claim my desk, chair or laptop as well?
Yes. The 70c rate only covers running costs, so the decline in value (depreciation) of equipment like a desk, chair, monitor or laptop is claimed separately on top. Items costing $300 or less can usually be claimed in full immediately.
Do I need a separate home office to use the fixed rate?
No. The fixed rate method doesn't require a dedicated room — working at the kitchen table is fine. You do need a full-year record of your actual hours and at least one bill for each running cost the rate covers.
Run your own numbers