Modern smartphones can handle complex tasks like mobile banking, invoicing, and managing calendars in your professional and personal life. Perhaps you’re in a profession, such as a delivery driver or estate agent, where a work phone is necessary, or you’re a freelancer using the same device for all your errands.
Understanding whether your mobile phone is an eligible deductible can help you minimise your final tax bill. Read on as we answer the golden question, “Can I claim my mobile phone?” and explore whether the same rules apply to related costs, like the internet.
Can I Claim My Mobile Phone
Yes, you can claim a tax deduction on a mobile phone you use for work purposes. Work phones supplied by the company free of charge aren’t eligible. If you use your mobile for a blend of personal and professional tasks, you must calculate the percentage of time you use your phone for work.
So, how do you differentiate between professional and recreational use? See a broad overview below:
|Communicating with clients, suppliers, and colleagues.
|Contacting friends and family.
|Social media provided it’s an official part of your job.
|Recreational use of social media and entertainment applications, like Netflix or games.
|Engaging with presentations and video conferences.
|Personal health applications, such as step count (unless part of your work remit).
|Productivity applications, like a digital measurement app.
Fortunately, most modern smartphones come equipped with screen time monitoring, helping you calculate usage percentages for your tax. Recording your activity in a logbook or dedicated timesheet for at least four weeks is also key. This information enables the Australian Taxation Office to confirm itemised usage.
How to Claim Your Mobile Phone
You can claim an immediate deduction for the price of a device if you paid $300 or less. You can receive depreciation on mobiles worth more than $300. To be eligible for this deductible, you must meet the following criteria:
- You’ve paid for the device and have a receipt or invoice proving the payment
- You aren’t already receiving the 67 cents per hour work-from-home deduction
You must work out the business percentage of mobile phone contracts or lease costs using the following calculation:
- Mobile’s monthly contract: $55 for 6 months
- Percentage of work usage: 65%
- Calculation: $55 x 0.65 x 6 = $214.50
Do Mobile Texts, Calls, and Internet Costs Count?
The Australian Taxation Office allows the following:
- Work-related texts: 0.25 cents
- Work-related calls: 0.75 cents
You cannot claim communications with friends and family members, as this is considered personal use (unless they’re deemed an employer, colleague, or vendor). Internet expenses are also deductible, but, like the above, you must calculate the time spent completing work duties. You cannot claim the internet that you haven’t paid for personally.
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