Phone, Internet and Computer Claims for Employees
Maximise your technology deductions with the right calculation methods
In this guide, you will learn: How to calculate your work-related phone and internet percentages, when to claim computers immediately versus depreciating them, the specific records the ATO requires, and common mistakes that trigger audits and amended assessments.
In today's connected workplace, your personal phone, home internet, and computer are often essential work tools. The good news is you can claim the work-related portion. The challenge is calculating and documenting that portion correctly, without overclaiming or missing out.
Who This Guide Is For
This guide is essential reading if you:
- Use your personal mobile phone for work calls, emails, or apps
- Use your home internet connection for work purposes
- Purchased a computer, laptop, or tablet used partly for work
- Work from home some or all of the time
- Have been claiming a flat percentage without proper records
Whether you are a full-time remote worker, hybrid employee, or simply someone who checks emails outside office hours, understanding these rules matters for your tax return.
Step 1: Calculate Your Phone Work Use Percentage
Hook: The four-week diary that determines your claim for the entire year
The ATO does not expect you to log every work call for 12 months. Instead, they accept a representative four-week diary period to establish your work-use percentage, which you then apply to the whole year.
How to Create a Valid Phone Use Diary
- Choose a representative four-week period: Not during holidays, major projects, or unusual circumstances. Pick a typical month.
- Record all usage: Track every call, text, and data session, noting whether it was work or personal.
- Calculate the percentage: Divide work usage by total usage to get your work-related percentage.
- Apply to annual cost: Multiply your total phone bill for the year by this percentage.
Example: Sarah's Phone Calculation
Sarah's four-week diary shows:
- Total calls: 180 minutes
- Work calls: 72 minutes (40 percent)
- Total data: 15GB
- Work data (emails, apps, Teams): 6GB (40 percent)
Sarah's annual phone plan: $1,200 per year
Work-related claim: $1,200 x 40 percent = $480 deduction
Alternative: Itemised Bill Method
If you have itemised bills, you can identify specific work calls and claim those directly. This is more precise but requires more effort. Most employees find the diary method simpler and equally valid.
What If You Have a Work Phone and Personal Phone?
If your employer provides a phone for work use, you generally cannot claim anything for that device. If you pay for a personal phone used purely for personal purposes, there is no work claim. Claims only arise when you use personal devices for work purposes or contribute to employer-provided phone costs.
Step 2: Calculate Your Internet Work Use Percentage
Hook: The calculation that most work-from-home employees get completely wrong
Internet claims are more complex than phone claims because household internet serves multiple purposes and multiple people. You cannot simply claim based on work hours.
Method 1: Work Hours Percentage (Simple)
Calculate what percentage of total internet usage occurs during your work hours.
Example Calculation
- Your work-from-home hours: 8 hours per day, 3 days per week
- Weekly work internet hours: 24 hours
- Household total internet usage hours: 80 hours per week (estimate)
- Your work percentage: 24 divided by 80 = 30 percent
- Annual internet cost: $1,200
- Deduction: $1,200 x 30 percent = $360
Method 2: Data-Based Calculation (More Accurate)
If you can measure work-related data usage separately from personal usage, this provides a more defensible calculation. Some routers and apps can track this.
Adjustment for Shared Households
If you share your internet connection with family members who also use it for streaming, gaming, or their own work, you need to factor this in. The ATO expects you to claim only your work-related share, not your household's total work-related share.
Example: Shared Household Adjustment
You live with a partner who also works from home.
- Household internet: $1,200 per year
- Total work use by both of you: 40 percent
- Your share of work use: 20 percent (half of total work use)
- Your deduction: $1,200 x 20 percent = $240
Your partner can claim the other 20 percent on their return.
Important: Do Not Double-Dip with the Fixed Rate Method
If you use the 70 cents per hour fixed rate method for work-from-home expenses, your internet costs are already included in that rate. You cannot claim internet separately. Choose one method or the other.
Step 3: Handle Computer and Device Claims Correctly
Hook: The $300 threshold that changes everything about your technology claims
Computers, laptops, tablets, and other technology devices follow the standard equipment rules, but there are specific considerations for technology.
Under $300: Immediate Deduction
If your device costs $300 or less, claim the work-related portion immediately.
Example: $250 tablet used 60 percent for work = $150 immediate deduction.
Over $300: Depreciate Over Effective Life
The ATO sets these effective lives for common technology:
- Laptop or desktop computer: 4 years
- Tablet: 2 years
- Mobile phone: 3 years
- Computer monitor: 5 years
- Printer: 5 years
Example: Laptop Depreciation
- Laptop cost: $1,800
- Work use: 75 percent
- Work-related cost: $1,350
- Effective life: 4 years
- Using prime cost method: $1,350 divided by 4 = $337.50 per year for 4 years
Software and Subscriptions
What about software, apps, and cloud subscriptions used for work?
- Subscription software (Microsoft 365, Adobe Creative Cloud): Claim the work-related percentage as an immediate deduction each year
- One-time software purchase under $300: Claim the work-related portion immediately
- One-time software purchase over $300: Depreciate over the software's effective life (often 4-5 years)
Example: Microsoft 365 Subscription
- Annual subscription: $139
- Work use: 80 percent
- Deduction: $139 x 80 percent = $111.20
Step 4: Claim Accessories and Peripherals
Hook: The small items that add up to significant deductions
Beyond your main devices, various accessories and peripherals can qualify for deductions. Each item under $300 is immediately deductible; over $300 must be depreciated.
Common Claimable Accessories
- External keyboard: Typically $50-200 (immediate)
- Mouse or trackpad: Typically $30-150 (immediate)
- Webcam: Typically $50-250 (immediate)
- Headset or headphones: Typically $50-400 (check threshold)
- External monitor: Typically $200-600 (check threshold)
- Docking station: Typically $100-400 (check threshold)
- USB hub: Typically $20-80 (immediate)
- Laptop stand: Typically $30-150 (immediate)
- External hard drive: Typically $80-250 (immediate)
- Cables and adapters: Typically $10-50 each (immediate)
The Set Rule for Computer Accessories
Remember that items purchased together to form a functioning system may be treated as a single asset. A laptop, monitor, keyboard, and mouse bought at the same time could be treated as one depreciating asset valued at their combined total.
Strategy: If buying multiple items, consider purchasing at different times to clearly establish them as separate assets, but only if this genuinely reflects your needs, not as artificial tax minimisation.
Step 5: Maintain Proper Records
Hook: The records that turn a rejected claim into an approved one
The ATO has specific record-keeping requirements for phone, internet, and computer claims. Without proper records, your claims can be reduced or rejected entirely.
Required Records: Phone and Internet
- Bills: Keep all monthly bills or annual statements showing costs
- Diary or usage record: Your four-week representative diary establishing work use percentage
- Calculation notes: Document how you arrived at your work-use percentage
- Keep for 5 years: All records must be retained for 5 years from the date you lodge your return
Required Records: Computers and Equipment
- Purchase receipt: Showing item, date, and cost
- Work-use percentage evidence: Diary or reasonable estimate of work versus personal use
- Depreciation schedule: Track each depreciating asset, its cost, effective life, and annual depreciation claimed
- Disposal records: If you sell, discard, or give away an asset, record the date and any proceeds
How Detailed Must Records Be?
The ATO does not require perfection, but they require reasonableness. A four-week diary that shows 42.7 percent work use is fine to round to 43 percent or even 40 percent. What they reject is claiming 80 percent work use with no supporting evidence whatsoever.
Common Mistakes and Audit Triggers
Hook: The claims that make auditors immediately suspicious
Mistake 1: Claiming 100 percent for any device
Unless you have a second, completely separate device for personal use, claiming 100 percent work use for a phone, laptop, or internet connection is almost never accepted. Everyone makes personal calls, checks social media, or streams entertainment occasionally. Be realistic.
Mistake 2: No work-use evidence
Simply claiming "50 percent" with no diary, calculation, or supporting evidence is a red flag. Even a simple calculation showing your reasoning provides something to support your claim.
Mistake 3: Double-dipping with fixed rate method
The 70 cents per hour fixed rate includes phone, internet, and electricity for your home office. If you use this method, you cannot separately claim phone and internet. Choose one approach.
Mistake 4: Forgetting the $300 threshold
Claiming a $500 computer in full as an immediate deduction is incorrect. It must be depreciated. This error is common and easily caught in ATO data matching.
Mistake 5: Not adjusting for employer reimbursement
If your employer pays you an internet or phone allowance, you can only claim expenses exceeding that allowance. Include the allowance as income and only claim the portion you actually pay yourself.
Mistake 6: Claiming equipment not connected to income
Your gaming PC used to play video games at night is not deductible, even if you sometimes check email on it. The device must have a genuine, substantial connection to earning your income.
Complete Example: Marcus's Technology Claims
Hook: Putting it all together for a realistic claim
Marcus is a marketing manager who works from home three days per week. Here is how he calculates his technology deductions:
Mobile Phone
- Annual plan cost: $1,320
- Four-week diary shows 35 percent work use
- Deduction: $1,320 x 35 percent = $462
Home Internet
- Annual cost: $1,200
- Marcus's work hours: 24 hours per week
- Household usage (Marcus and partner): estimated 70 hours per week
- Marcus's work percentage: 24 divided by 70 = 34 percent
- Deduction: $1,200 x 34 percent = $408
Laptop (purchased this year)
- Cost: $2,200
- Work use: 70 percent
- Work-related cost: $1,540
- Effective life: 4 years
- Year 1 depreciation (prime cost): $1,540 divided by 4 = $385
Accessories (purchased this year)
- External monitor ($320 x 70 percent work): Must depreciate over 5 years = $44.80
- Keyboard ($89 x 70 percent work): $62.30
- Mouse ($69 x 70 percent work): $48.30
- Webcam ($129 x 70 percent work): $90.30
Software Subscriptions
- Microsoft 365 ($139 x 70 percent work): $97.30
- Adobe Creative Cloud ($52 per month = $624, x 60 percent work): $374.40
Marcus's Total Technology Deductions
Phone: $462 + Internet: $408 + Laptop: $385 + Monitor: $44.80 + Accessories: $200.90 + Software: $471.70 = $1,972.40
At a 32.5 percent marginal tax rate, these technology deductions save Marcus $641 in tax.
How TaxBot Streamlines Technology Claims
TaxBot makes tracking phone, internet, and computer expenses simple and audit-proof:
- Usage Diary Tool: Log work and personal use for a representative period, and TaxBot calculates your percentage automatically
- Bill Tracking: Photograph monthly bills; TaxBot extracts the amounts and applies your work-use percentage
- Device Register: Track all technology assets, their cost, work percentage, and depreciation status
- Depreciation Calculator: Automatically calculates annual depreciation for each device over its effective life
- Method Comparison: See whether claiming individually or using the fixed rate method gives you a better outcome
- Real-Time Total: Watch your technology deductions accumulate throughout the year
TaxBot users claim an average of $380 more in technology deductions than manual filers, simply through better tracking and not missing small expenses that add up.