Can I claim a desk on tax deductions? This is a question we see asked all the time. The fact of the matter is that claiming desk on tax can be complicated in Australia.
Whether you work from home permanently or temporarily, you most probably have a lot of office equipment at your home. You might even be thinking of purchasing a motorized standing desk for your home office setup. And if you're looking for the best standing up desk in Australia, look no further than UpDown Desk. Across our entire catalog, you'll find the premier selection of height adjustable desks online - standard 2-leg electric standing desks, corner or l-shaped standing desks or manually height adjustable desks - we've got it all.
There are so many reasons standing desks are worth it - better productivity, enhanced health and comfort, and the aesthetic they provide. But, they're pretty expensive - which leads many Australians to wonder if you can claim a desk on taxes at the end of the year.
You might want to ensure that your valuables, such as your standing desk are covered when tax time approaches. Read below to find out whether your standing desk is tax deductible.
Can You Claim Standing Desk on Taxes?
Is it possible to claim a desk on tax returns? The answer is yes.
Business owners & individuals who are working from home can claim a tax deduction on a majority of expenses that are required when carrying out their business. These expenses need to be directly related to gaining assessable earnings.
It’s difficult to carry out the necessary work without relying on a functional workplace setup. For this reason, you can claim a tax deduction for office furniture, such as standing desks, chairs, shelves, and storage.
Office equipment qualifies as a capital expense. Capital expenses refer to the costs that you incur when purchasing assets that have a serviceable life over 1 year.
The criteria for what office furniture can be claimed for tax deduction are as follow:
- The expenses are for carrying out work, and not for private use
- If the expenses are a mixture of work and private use, then you can only claim the part that is being used for work
- A record is kept to show expenses
As an employee, you are also allowed to claim a tax deduction for your expenditure on office furniture. Make sure that you have not already claimed these amounts with your employer.
For these reasons, it doesn’t matter whether you’re running a small business, working from home, or you are an employee of a large corporation. If you are an Australian tax resident you are eligible to claim deductions when submitting your yearly tax return.
How Do Home Office Expenses & Tax Deductions Work?
So, you know you can take advantage of a home office deduction on your taxes when you invest in certain home office equipment. But how do you write off standing desks on taxes? How do home office expenses work come tax season?
Let’s say you’ve already set up your home office with furniture, such as a new standing desk. If that’s the case, you can claim a deduction for the decline in value of that standing desk to the degree that it relates to your work operations.
The standing desk’s “effective life” will permit you to claim a deduction.
A standing desk that costs less than $300 can be written off and does not need to be depreciated.
If, for example, you have a tax rate of 30%, you can claim back 30% of your spending on office equipment. If you spend $2,000 on a new standing desk, your income tax deduction would amount to $600. Unless you are carrying on a business and use the Small Business Support - $20,000 Instant Asset Writeoff measures (see below) you will deduct this amount over time as the value of the asset declines. This will be over multiple tax years.
In essence, submitting tax deduction office furniture claims will ensure a deduction for:
- The full price of the item, if it is less than $300, or
- The decline in value for items over $300
To figure out the exact drop in the value of your furniture year after year, you need to know how long standing desks last.
You can also check out what the ATO says about claiming expenses for working from home here.
Small Business Support - $20,000 Instant Asset Writeoff
In the federal budget handed down on 9 May 2023 the government proposed to introduce a Small Business Support measure for the 2023/2024 tax year increasing the instant asset write-off threshold for small businesses to $20,000. This was proposed to apply on a per asset basis. To be eligible, a business had to have an aggregate turnover less than $10 million.
This legislation is still before the parliament, with proposed amendments to increase the instant asset write-off threshold to $30,000 and extend the eligibility to businesses with an aggregate turnover less than $50 million.
Under the above measures eligible businesses would be able to claim an upfront deduction for their standing desk purchases.
This measure is not yet law.
How To Cover Your Standing Desk For Tax Deductions: Step by Step Guide to Claiming Desk on Tax
Ready to learn how to cover your standing desk for tax deductions? We described how home office expenses work above. But now, we want to take you on a step-by-step journey to claiming a desk on tax deductions. It's as simple as assembling an inventory list, keeping track of your receipts, archiving your records, and deducting the right expense from your taxes. Keep reading to learn more...
Assemble An Inventory List
If you want to make a claim for a home office deduction, then it’s important to keep track of all of your office equipment. The first important step is to make an inventory list.
Hold On To Your Receipts
It’s common for employees and employers to have inadequate documents to support tax deduction claims.
If you bought a new standing desk or any new office furniture, make sure to hang onto those receipts so you can claim them later.
Make a note of the standing desk model. This will help you track the item over time, as well as provide useful information.
Keeping accurate records of your office expenses allows you to submit a concise and clear claim on your office tax deduction.
If you don’t want to invest in a fully built standing desk, you can look into investing in a standing desk riser for your office. These are significantly cheaper than standing desks, but you can still claim for them provided you follow the same steps.
Closing Thoughts on Claiming Standing Desk on Tax Return
The COVID-19 pandemic changed the way many organisations do business. Companies need to prioritise the safety of their employees and as such, many employees have been given the option to work from home.
However, there are still costs involved in work operations, such as furnishings and equipment. Thankfully, you are permitted to claim a tax deduction on home office furniture, and this includes standing desks for your own business. You'll be glad you did - and if you're not convinced, read our blog post on standing desks and productivity! This investment pays for itself fast - so upgrade your workspace today.
