Eligibility to claim mobile phone calls and mobile internet
To claim a deduction for mobile phone calls and mobile internet (data), you must meet all of the following conditions:
- You must incur the cost and make the phone calls or use the data to perform your work duties.
- You must have a record of your expenses showing the total amount you incurred and how you calculated your work-related phone calls and data.
You can only claim the work-related portion of your expenses as a deduction.
Similar rules exist for home phone and internet expenses for work purposes.
Exceptions to eligibility for working from home
If you use the fixed rate method – 67 cents to claim your working from home expenses, your deduction for phone and data usage expenses is included in that deduction. You can't claim any other deduction for phone and data usage expenses.
You will need to meet the eligibility and record keeping requirements of the work from home method you use.
Eligibility to claim mobile phone and other devices
To claim a deduction for a mobile phone (handset or smartphone) or other devices, you must:
- incur the cost and use the item to perform your work duties.
- have a record of your expenses and use of the item.
How you calculate your deduction depends on the cost of your mobile phone or device.
When you use the items for both private and work purposes, you need to apportion your deduction. You can only claim the work-related use of the item as a deduction.
You can also claim a deduction for the work-related portion of costs you incur to insure your device.
Work-related use includes using the device (or mobile internet) to access a Digital ID app on your device to access online services to do your work.
Example: employee uses existing smartphone – apportioned personal and work use
Eliza works in the payroll department of a large company. Her duties involve calculating the pay for employees and ensuring that her employer meets their superannuation guarantee obligations. In order to carry out these duties, Eliza requires a Digital ID, such as myID to access ATO online services on behalf of her employer.
Eliza bought her smartphone on 1 July 2023 for $1,100. She uses her smartphone for private phone calls and for making and receiving work-related calls.
On 29 February 2024, she uses the smartphone to set up myID. Her employer gives her authorisation to access ATO online services through the Relationship Authorisation Manager.
As Eliza has been using her smartphone for both private and work purposes during the income year, she has kept itemised accounts and diary records representing a 4-week period.
Eliza's records prior to using her smartphone to access ATO online services, show that up until 29 February 2024, she used her smartphone 40% for work purposes.
From 1 March 2024 when she started using her myID for work purposes, Eliza found that her use of the smartphone increased to 50% for work purposes. She works this out by looking at the increase in data used from that date.
As Eliza is on a $50 per month bring your own phone plan, she can claim a deduction for 40% of her monthly plan rate from 1 July 2023 to 29 February 2024.
Eliza took 4 weeks leave during this period so she excludes the 4 weeks from her calculation for that period.
Eliza can also claim a deduction for 50% of her monthly plan for the period from 1 March 2024 to 30 June 2024.
Her deduction of $240 for her monthly plan is calculated as follows:
($50 × 7 months) × 40% = $140
($50 × 4 months) × 50% = $100
$140 + $100 = $240
Eliza can also claim a deduction for the decline in value of her phone. She decides to use the diminishing value method and calculates the decline in value using the following formula:
Base value × (days held ÷ 365) × (200% ÷ asset's effective life)
$1,100 × (366 ÷ 365) × (200% ÷ 3 years) = $735
($735 × 7 ÷ 12 months) × 40% = $171.50
($735 × 4 ÷ 12 months) × 50% = $122.50
$171.50 + $122.50 = $294
In her return for the 2023–24 income year, Eliza can claim a total deduction for her phone expenses of $534 ($240 + $294).
End of exampleWhat you can't claim
You can't claim a deduction for:
- your mobile phone and internet use for private purposes – for example
- personal phone calls and texts to family and friends
- seeking employment – as you are not generating employment income from the use of the phone
- installation and set up costs for mobile phones and other devices
- expenses for mobile phone calls or mobile internet where someone else pays the bill or reimburses you
- expenses for the phone or other device where someone else supplies the item for use
- expenses for phone calls or text messages if you're a casual employee and either
- an employer phones or texts you to ask you to work
- you phone or text your employer to check on work availability.
Types of mobile phones and devices you can claim
If you meet all the eligibility conditions, you can claim a deduction for the decline in value of the following depreciating assets:
- your mobile phone – for example, smartphone, basic mobile phone or a feature mobile phone
- electronic devices – for example, tablets, personal digital assistants, and portable GPS navigation receivers.
How to calculate your deduction for phone and data use
You can calculate your mobile phone and data use expenses for a work purpose by:
- claiming incidental use ($50 or less), with basic records to show how you calculated your claim, based on a cost of
- $0.75 for work phone calls made from your mobile phone
- $0.10 for text messages sent from your mobile phone
- keeping records and written evidence to work out actual expenses for work-related use.
If you use the fixed rate method – 67 cents to calculate a deduction for your working from home expenses, you can't claim a separate deduction for phone and data usage. You will need to keep the records required for that method even if your mobile phone and data expenses are incidental.
How to work out your work and private use
There are many types of phone and data plans available. You will need to work out your work-related percentage of phone calls and data on a reasonable basis. Your options are based on whether your:
The way you predominantly use your mobile phone is also relevant to how you calculate your work-related use percentage. For example, if you predominantly use it for phone calls, then comparing your work-related phone calls to your total phone calls will be the most relevant way to calculate your work-related use percentage.
If your work and private use of different functions is quite different, you may also need to apportion the cost of the plan between those services.
For more information on how to calculate your work-related use of your mobile phone, see PS LA 2001/6 Verification approaches for electronic device expenses.
Use is itemised on your bills
If you have a phone plan with an itemised bill, you need to work out your percentage of work use over a continuous 4-week period (one monthly bill), that you can then apply to the full income year.
You need to work out your work use percentage using a reasonable basis. This could include the:
- number of work phone calls made as a percentage of total phone calls
- amount of time spent on work phone calls as a percentage of your total phone calls
- amount of mobile internet (data) downloads for work purposes as a percentage of your total data downloads
- any additional costs you incur as a result of your work-related use – for example, if your work-related use results in you exceeding your monthly cap.
Example: phone calls are itemised on your bill
Julie has a $65 per month mobile phone plan, which includes unlimited phone calls and text messaging and 80GB of mobile internet. She receives a bill that itemises her phone calls and shows her monthly data use.
Julie only uses her mobile phone internet for work when she is out of the office for client meetings. These meetings are all scheduled in Julie's work calendar.
Julie uses her phone bill for the month of August to work out her work-related use percentage for the entire year of income. On this bill, she identifies the work-related phone calls and private phone calls. Julie uses her work calendar to work out the data downloaded for work purposes.
Based on the number of work-related phone calls and data downloaded, Julie calculates that 20% of her phone calls and mobile internet use is work-related.
She worked for 11 months during the income year, having had one month of leave.
Julie calculates her deduction for mobile phone expenses as:
20% × $65 × 11 months = $143
Julie can claim a deduction of $143 in her tax return.
End of exampleUse is not itemised on your bills
If you have a phone plan where you don’t receive an itemised bill, you must work out your work-related percentage use by:
- keeping a record of all your work-related and private phone calls and the time you spent using the internet for work and private purposes over a continuous 4-week period
- calculating your claim using a reasonable basis – for example, the number of work-related calls as a percentage of total calls.
Example: non-itemised account
Ahmed has a prepaid mobile phone plan that costs him $50 per month.
Ahmed does not receive a monthly bill, so he keeps a record of the time he spends using his phone for work-related phone calls and using the mobile internet for work for a continuous 4-week period.
During this 4-week period, Ahmed spends 25 hours making work phone calls and using his mobile internet for work and he spends 75 hours using his phone for private purposes.
Ahmed worked for 11 months during the income year, having had one month of leave.
Ahmed's work use percentage is 25% (25 work hours ÷ 100 total hours).
Ahmed calculates his claim for mobile phone and internet use as:
25% × $50 × 11 months = $138
He can claim a deduction of $138 in his tax return.
End of exampleHow to calculate your deduction for a mobile phone or other electronic devices
Mobile phones and other electronic devices are generally depreciating assets that decline in value over time.
How you treat and work out your deduction will depend on if the item cost:
You need to apportion expenses if you use mobile phone or other electronic device for both work and private purposes.
$300 or less
An immediate deduction is available for items that cost $300 or less, if you use them more than 50% of the time for work purposes. You must satisfy the conditions of 4 tests to claim an immediate deduction.
More than $300
You can claim a deduction for the decline in value over the effective life of the item, if the item cost more than $300.
Calculating your claim
Work out your claim for the decline in value for a depreciating asset, using our Depreciation and capital allowances tool.
Depreciation and capital allowances toolYou can manually calculate the decline in value of a depreciating asset using either the prime cost method or diminishing value method.
Keeping records for mobile phone, mobile internet and other devices
You must keep records to support your claim for work use of mobile phones, internet and other devices, except where your claim is for incidental expenses ($50 or less).
Records you need to keep may include:
- diary entries, including electronic diary records, to show how you worked out your percentage of work-related use
- bills for mobile phone and mobile internet (data) services
- receipts for phones and devices you buy
- evidence that you need to use a Digital ID app, such as myID to access online services for work purposes.
If you are claiming the decline in value of an asset, you also need to keep records that show how you calculated decline in value.
For more information on general record keeping requirements and formats, see Records you need to keep.