Using your home internet for work? You might be able to reclaim a slice of those bills when you lodge your tax return this end of financial year (EOFY).

From video conferences and large uploads to research and everyday emails, the work-related portion of your home internet (and related equipment) could qualify as a tax deduction.

How tax deductions work?

When you claim a deduction, you’re telling the Australian Taxation Office (ATO) that certain expenses helped you earn your income. The result? Your taxable income goes down thanks to these ‘deductions’, which could mean you pay less tax or even receive a refund.

Here’s five pointers to help you make the most of your home-internet deductions this EOFY. As always, we recommend checking in with a registered tax agent or accountant so that you can receive tailored professional advice for your unique circumstances.

1. What home internet costs could I claim?

You may be eligible to claim deductions for the work-related share of:

• Monthly internet service fees
• Home-network equipment (modems, routers, Wi-Fi boosters)
• Home-phone calls bundled with your internet plan
• Streaming or subscription services (but only when directly tied to your job)

Quick tip: Only the work-related portion counts. Your private use isn’t deductible.

2. How do I calculate my home internet’s work-related use?

The ATO recommends tracking a continuous four-week period to gauge your typical work-use percentage, then applying that rate to your annual costs. Here’s an example of how you might go about calculating the work-related portion of your internet:

1. Pick a representative 4-week span

a. Log the hours you spend online for work each day.

b. Note total household internet hours (everyone’s combined usage).

2. Work out your work-use percentage

a. Example: Over four weeks, you log 50 hours of work browsing/uploading, while the household clocks 200 hours total.

b. Work-use proportion = 50 ÷ 200 = 25%.

3. Apply that rate to your bills

a. Internet plan = $80/month → $80 × 25% = $20/month

b. Annual claim = $20 × 12 = $240

4. Adjust for variations

a. If you know you worked extra hours in another busy month, repeat the log for that period and average the percentages.

Quick tip: A simple spreadsheet or diary app can keep your entries organised and easy to reference.

3. Can I claim the cost of my modem or other home internet equipment?

According to the ATO, how you claim depends on the device’s value:

• Under $300: You could claim your work-use percentage in full for the financial year.
• Over $300: You’ll need to depreciate the item over its effective life, claiming your work-use share each year.
  • For example: You buy a $360 router and use it 40% for work. That’s a $144 deduction, claimed as $72 per year across two years.

Quick tip: Keep purchase invoices and depreciation schedules handy for audit purposes.

4. What internet costs can’t I claim?

To keep your claim in line with ATO rules and guidelines, here’s what you can’t include:

• Private browsing or streaming
• Costs reimbursed by your employer
• Employer-supplied equipment
• One-off connection or installation fees

5. What records do I need to provide?

Here’s what information the ATO recommends you keep handy when claiming:

• A 4-week diary or log detailing work-related internet use
• Monthly bills showing service and any bundled components
• Proof of purchase for devices you’re depreciating (if claiming modem or Wi-Fi booster device costs)
• Itemised breakdown for bundled plans, if applicable

Quick tip: Keep your records for at least five years. The ATO can request them up to that point.

6. How do I apportion bundled plans?

Many of us pay one bill for internet, home phone, and maybe even streaming. To calculate how you may claim only the work-related bit for each service:

1. Identify individual service costs

a. Use your provider’s itemised bill or similar plans from a comparable supplier to split the total.

2. Log work-use percentages separately

a. Keep distinct 4-week logs for internet, phone calls and any other service you’ll claim.

3. Calculate each claim

a. Internet: (Monthly cost) × (Work-use %) × (Months used)

b. Phone: same formula with its own cost and percentage

4. Sum your deductions

a. Example:

i. Bundle costs $120/month: $90 internet + $30 home phone

ii. Internet work use = 20% → $90 × 20% × 11 months = $198

iii. Phone work use = 10% → $30 × 10% × 11 months = $33

iv. Total deduction: $231

Is now a smart time to upgrade before EOFY 2025?

If you’re considering upgrading your home internet, doing it before June 30th could mean a tax time claim.

• Under $300 devices: You may be able to claim it as a deduction on your next tax return.
• Over $300 devices: You’ll need to start calculating the item’s depreciation and claim your work portion over subsequent years.

Quick tip: Only the work-related portion qualifies. Track it from day one when setting up your new service or equipment.

Explore the latest Vodafone EOFY offers

Disclaimer: This is not professional tax advice, and you should always consult a registered tax agent for professional advice related to your taxable income, tax deductions and tax returns. All information and claims presented have been taken from the ATO website.