Use your phone for work? Here’s how you could maximise your savings at tax time

How do tax deductions work?

Tax deductions are work-related expenses which you could use to reduce your taxable income. This means you could end up paying less in tax or even get a tax refund.

Here’s 5 quick tips to help you get the most out of your phone-related tax claim this EOFY. At tax time, it’s always a good idea to chat to a professional – like a registered tax agent or accountant – to get the right tax advice for your personal situation.

1. What mobile phone costs could I potentially claim?

You may be able to claim deductions for the work-related use of your personal mobile phone.

Deductions can include:

• Calls and texts
• Data used for work-related tasks like emails, apps or browsing
• A portion of your monthly phone plan fees
• Part of your phone cost

Quick tip: Only the work-related portion counts, so a little careful tracking now could mean savings later.

Now that you know what you can claim, let’s look at how you could calculate your claim.

2. How do I calculate my phone’s work-related use

The Australian Taxation Office (ATO) suggests you use a 4-week typical period to work out your claim. This means logging your usage over 4 weeks (or a single month) to estimate your annual work-related usage percentage.

For example: If your phone bill is $60/month and you use it 50% of the time for work, you could claim $30/month or $360 over 12 months. If your usage varies throughout the year, keep a detailed log to show how it varies.

Now that you know how you could calculate your claim, let’s look at claiming your mobile phone.

3. Can I claim the cost of my phone?

Claiming your mobile phone on your tax return depends on how much the device costs.

How it works:

• Under $300: You can claim all work-related usage within the financial year
• Over $300: You’ll need to claim it over time, typically a period of 2 to 3 years

For example:

Eve brought a phone for $1,200 and uses it 50% for work. That means $600 is tax deductible. If the phone’s effective life is 3 years, Eve could claim roughly $200 per year. Effectively lowering Eve’s taxable income by $200 per financial year.

Quick tip: Don’t forget to hold onto all your receipts and records.

Example: Eve reduced her taxable income by $534

Eve works in retail and uses her phone regularly for work, checking rosters, using business apps, and staying in touch with her team.

This is a breakdown of what Eve can claim on tax:

• Phone plan: $50/month
  • Work use: 40% (July-Feb), 50% (March-June)
• Claimed plan deduction:
  • 8 months phone usage (July – Feb) at 40% work use = $160 in deductions
  •  4 months (March – June) at 50% work use = $80 in deductions
• Phone cost: $1,100 (claimed over the time used for work)
  • Work use at 50% = $550 deductible, claimed over a 2-year depreciation

Total deduction: $240 for her plan + $294 for her phone.

That’s a $534 deduction on Eve’s overall taxable income.

Now that you know how you could claim your phone, let’s look at what you can’t claim.

4. What phone costs can’t I claim?

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

• Personal use (calls, texts, data)
• Any costs reimbursed by your employer
• Work phone supplied by your employer
• One-off setup or installation fees

Now that you know what you can’t claim, let’s look at what records you’ll need.

5. What records do I need to provide?

Here’s what information you should keep handy when claiming:

• A 4-week log showing your work-related usage
• Phone bills that reflect your usage patterns
• Proof of purchase your phone (if claiming mobile device cost)

Quick tip: Keep your records for at least five years, the ATO may ask to see them.

Is now a smart time to upgrade before EOFY 2025?

Whether you’re upgrading your phone and plan or getting a new SIM Only Plan for work, doing it before June 30th could mean a tax time claim.

How it works:

• If your phone costs under $300 – you could claim the work portion in full this financial year
• If it’s over $300 – you’ll need to claim it over a period of 2 – 3 years

Quick tip: Only the work-related portion is eligible for claims, so keep that in mind when working out your deductions.

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 can be found on the ATO website.