With the recent COVID-19 pandemic that took the world by storm in 2020, it ushered in a new era of ‘working’ from home. Whilst countless people lost their jobs as many industries suffered under the weight of the economic turmoil brought on by the pandemic, many people were given the opportunity to carry on with their duties at home.
Others who were not so lucky, were forced to find alternative means of earning. This pushed many people to look online for answers, including online teaching, graphic design, and copywriting (to name a few).
In any case, if you are currently working from home, or considering it, you’ll need a suitable space to work from. Kicking back on the sofa with your laptop might sound like a good idea, but you will find your motivation levels lacking.
Instead, you should consider having a spare bedroom remodeled into an office. The question is, is a home office renovation tax deductible? In this article, we will share some quality remodeling tips and shed some light as to whether you will be able to claim anything back after successfully completing yours.
Remodeling A Bedroom into an Office
Remodelling a bedroom into an office is the ideal option for those looking to work and earn comfortably from home. It allows you privacy, productivity, and a personalized space for you to pursue both your creative and work endeavours.
Here are some simple tips to get you started:
Do not underestimate the importance of natural light
For a home office, you want to try and avoid excessive glare from your computer screen to take the strain off your eyes. This means allowing in as much natural light as possible, coupled with a soft lighting scheme option.
By situating your desk near a sought of natural light, you will be able to keep your body in tune with the natural cycles of the day, helping you to get some quality sleep once you have finished working.
You should also consider trying out the various apps that allow your computer screen to emulate natural light.
Settle on the perfect colour scheme to help your productivity
Believe it or not, the right colour palette for your home office is going to have a significant effect on the way that you work.
- A warm orange is ideal for stimulating concentration and boosting your overall creativity levels. We’d recommend a feature piece, rather than painting the entire office a burnt orange colour. Keep it subtle so as to be effective and not overbearing.
- If you would prefer your office space to give off a motivational vibe, some of the best designers suggest bright white with accents of purple. This is because purple is considered to be a restorative colour that calms and reenergises.
Ultimately, this is your space so go with whatever makes the most sense to you.
Suitable storage is essential
To be perfectly honest, you should endeavour to work and store information on the cloud. Going digital is safer, easier, more efficient, and paramount in offices that are wanting in size. If you prefer to keep your essential documents at hand, then consider storage space when planning your renovation.
Floating shelves are a brilliant option for creating storage solutions without compromising on floor space. You can even get brilliant office desks that will have all of the storage you could possibly need. Take your time and plan thoroughly before executing your renovation.
It’s all in the details
Settling on the perfect interior design ideas will be essential in keeping you motivated enough to get your work done in your home office. Something as simple as a cork board for pinning your ideas. Having a visual stimulus to keep you focused on ‘the big picture’ is truly invaluable in a home working environment.
Make the space your own
Renovating your home office space is a great opportunity for you to express yourself. You want a practical space that can double up as a personal reflection space. So, don’t be afraid to add some beautiful art pieces or your favourite photographs. Create a space you can be proud of and feel entirely comfortable in.
Hire an office fit-out specialist
Your best approach is to keep everything above board and hire an office fit-out specialist to complete the project for you. This will not only ensure the highest level of quality for the project, but it can help when it comes to claiming on tax (see next section for more information).
Is Home Office Renovations Tax Deductible?
Is home office renovation tax deductible? Simply put, yes. However, there are a few things you must be aware of:
If you operate some or all of your business dealings from home, then you are likely able to claim tax deductions under home-based business expenses. See the following categories:
- Occupancy expenses (mortgage interest / rent, council rates & land taxes, and home insurance premiums)
- Running expenses (electricity and phone bills, furniture & furnishing repairs, and cleaning expenses)
- Transportation between your home and other locations (assuming that the travel is primarily for business related purposes)
In order to make it easier for residents to claim deductions when working from home due to the COVID-19 pandemic, the government is allowing a ‘temporary shortcut method’, from March 1st 2020, through to the 30th June 2021. This enables you to claim a rate of 80 cents per hour for your business running expenses, as opposed to having to calculate the costs for specific running expenses (applying to home-based businesses as well).
In conclusion, you can indeed claim tax back on your home office renovation. This is a great opportunity to kit your home out with an incredible working space, whilst saving yourself some much needed cash during these difficult times.