IT home-office equipment and the $300 rule

The desk you actually work at is usually one you kitted out yourself: the second monitor, the mechanical keyboard, the chair that stops your back seizing up by mid-afternoon. Your employer covers the laptop and little else, so the rest is money you spent to do the job, and most of it is claimable. The question is never really whether a monitor or a keyboard counts. It is whether you deduct the whole cost this year or spread it across several, and one number decides that for every item on your desk.

The $300 line

A work item that cost $300 or less, and that you use mainly for work, comes off in full on the return for the year you bought it. That covers most of the peripherals around a developer's setup: a keyboard, a mouse, a webcam, a headset, a monitor arm, the cables and power board behind the desk, even a monitor if it came in under $300. Anything over $300 is claimed differently. A laptop, a good monitor, a standing desk, an ergonomic chair: each of those is claimed as decline in value, its cost written down over the effective life the ATO sets for it, a slice each year rather than the lot at once. All of this sits on top of the working-from-home fixed rate, not inside it, so equipment is a claim you make in addition to the cents-per-hour running costs.

The ATO's own example is worth holding onto because it shows the line is drawn per item, not per shopping trip. Buy a $250 desk and a $299 chair as separate purchases and you claim each one in full, because each is under $300 on its own and a desk and a chair are not a set. It is the cost of the individual item that matters.

Only the work share

A device you also use outside work is claimed at its work-use percentage, not its full price. A $1,500 laptop that you use 60% for work and 40% for personal browsing is depreciated on 60% of its cost, and the same apportionment applies whether the item is claimed in full or written down over years. The percentage is yours to work out honestly, and yours to justify if asked, so keep a record of how you arrived at it rather than reaching for a round number at tax time.

The self-built PC trap

This is the one that catches developers who build their own machines. You cannot buy a $2,000 rig as a CPU here, a GPU there, some RAM and a case, and treat each part as a sub-$300 item you write off in full. Where the components do not function independently for their intended purpose, and a graphics card on its own does not, the ATO treats the whole build as a single depreciating asset. So a big parts-plus-monitor spend is one item to be depreciated over its effective life, apportioned for whatever private use the machine gets. The build is a computer, and it is claimed like one.

Software and subscriptions

The tools you pay for to do the work are deductible for the work share, the same as the hardware. How you claim depends on how you bought them.

• Annual subscriptions. A yearly IDE licence, a cloud sandbox, an antivirus subscription: each is an immediate deduction in the year you pay it, because you are paying for that year's access.
• Perpetual licences over $300. A one-off licence that you keep is treated like a piece of equipment, so a perpetual licence costing more than $300 is depreciated over its effective life rather than claimed in one hit.
• Software bundled with the machine. Where software came baked into a computer's purchase price, it is not a separate claim. It is depreciated together with the machine it shipped on.

Repairs, insurance, and the write-off that isn't yours

Keeping your work gear running is deductible for the work share, separately from how you bought it. Repairs to a work laptop or monitor, and the work portion of insurance that covers your equipment, both come off. What does not apply to you is the rule every generic gadgets-and-tax article leads with. The instant asset write-off is a concession for people running a business on an ABN, not for employees. As an employee your rule is the strict one on this page: $300 or less is an immediate deduction, and anything over $300 is depreciated. If you are not certain which side of that you sit on, because you invoice through an ABN or the arrangement is ambiguous, that changes what deductible means across your whole return. The employee or contractor chapter is where to settle it before you rely on either rule.

The home lab grey area

A home lab, a rack of second-hand servers, a Kubernetes cluster in the spare room, is deductible only where it genuinely helps you earn your current employment income, where you paid for it and were not reimbursed, and then only for the work-use share. That is a narrow gate. A lab you run mostly for the enjoyment of it is a hobby. A lab you stand up to skill into a role you do not yet have is study toward future or different work, and fails the same test. A personal side project or a startup you are building on the side has no link to your current job, so its costs are private, or they belong to a separate venture, not on your employee return. And a gaming PC described as work gear does not escape any of this: it has to be apportioned to its real work use, and an ambitious claim on it is exactly what an auditor looks for.

The records behind it

Every item above stands on the receipt behind it: the date, the supplier, what it was and what it cost, kept for five years. For anything you also use personally, keep the note of how you settled on the work-use percentage, because that split is the first thing questioned on a device claim. And for the bigger items, hold the decline-in-value details, the cost, the effective life and the method you chose, so this year's slice and next year's both trace back to a figure you can stand behind. The ATO's free myDeductions app will store receipts and log the work-use split as you go, which beats reconstructing a year of purchases from a shoebox the night before you lodge.

The bottom line

Sort every purchase by what the single item cost. Under $300 and mainly for work, it comes off in full this year. Over $300, it is written down across its effective life. Either way you claim only the work-use share, and all of it sits on top of the working-from-home rate. A self-built PC is one asset, not a pile of cheap parts. Software is immediate if it is a yearly subscription and depreciated if it is a licence over $300. Leave the instant asset write-off to the businesses it was built for, keep the home lab honest about its link to your actual job, and back the lot with receipts. Do that and your whole desk lands on the return where it belongs.

General information only, not tax advice. Check the ATO or a registered tax agent for your situation.