Is House Cleaning Tax Deductible In Australia?

Finding ways to reduce your tax liabilities and gain financial benefits is always appreciated, but claiming your house cleaning can only be done in certain situations. 

While you can’t claim house cleans for personal expenses, you can claim it if you operate a business from home or if your business operates in property-related activities.

I’ve had years of experience in the cleaning industry, and as a business owner, I’ve found all the ins and outs of tax deductions for property owners who hire cleaners. It’s time to share that knowledge. 

In this article, I’ll explain the ins and outs of tax deductions in Australia and how to claim house cleaning on taxes. 

General tax deduction principles in Australia 

A tax deduction is an allowable expense. You can subtract it from your taxable income to reduce your tax liability. The Australian Tax Office has specific guidelines surrounding what can and can’t be deducted, ensuring legitimate business-related expenses are claimed. 

As a personal expense, something like house cleaning is not tax-deductible. Just like you can’t claim personal living expenses like rent or groceries–they don’t contribute directly to your ability to earn an income, so you can’t claim it as a deduction against your taxable income unless it is an investment property tax deduction. 

As with any rule, there are exceptions. Using any part of your home as a business office, you can claim related expenses, including cleaning and utilities. Some situations allow you to claim these deductions, and using an accredited tax accountant is an excellent place to start. 

Where exceptions apply

• Travel expenses: You can claim travel expenses if you have transportation or business trip costs related to your job.
• Self-education: If you are pursuing education directly related to your employment, you can deduct these.
• Clothing and laundry: If you are mandated to wear protective clothing or uniforms you purchase or launder on your dime, these are deductible.
• Home office running expenses: If you operate a business from home or work from home, you can deduct a portion of your home office expenses, such as office supplies, internet, and electricity. 

Personal versus business-related expenses

You must distinguish between business-related and personal expenses. The former, which are typically deductible, are incurred in the course of generating an income. The latter are not generally deductible and are for domestic/private purposes.

There are a variety of tax-deductible expenses for business operators, including property owners. If your costs are directly related to maintaining, managing, or operating a business, they’re deductible. If you own property, these deductible expenses include depreciation on assets, management fees, repairs, and the cost of advertising.

Business operators can claim utilities, rent, tools and equipment purchases, and employee wages. Pristine record-keeping is a must.

House cleaning for rental properties

Landlords are able to claim a range of rental property expenses, including house cleaning.

• If a property is actively rented out or is genuinely on the market and available for rent, you can claim house cleaning expenses. You can’t claim if the property was used for private use or under renovation.
• During the lease period, you can claim the cost of regular maintenance cleaning (the cost of maintaining communal areas, window cleaning, lawn mowing) and end-of-lease cleaning.
• If there are end-of-lease cleaning costs, you can claim these as deductions. The same applies to pre-rental cleaning, pest control services, and rubbish removal costs.

Keep accurate, detailed records to reflect your cost incursions so you can claim deductions successfully. Store your invoices, receipts, bank statements, rental records, and logbooks if you handle the cleaning yourself. You can’t claim for labour, but you can claim for cleaning materials.

Include these expenses in your annual tax return under rental property expenses for repairs and maintenance. Some costs may be classed as depreciating assets, such as installing fresh carpeting at the end of the lease. Business accountants can ensure you correctly claim. 

House cleaning for home offices

If you use part of your home as dedicated office space, you might be eligible for a range of tax deductions, including home cleaning costs.

For your home office to be classified as such, it must be a dedicated home office used exclusively for work purposes. Or a shared area that is used for work but is also used for typical household purposes. If your home office is a common area, your deductions are proportional. 

If you pay for a house cleaner, some of these costs can be claimed as a deduction for your home office. For example, if your home office is 5% of your home’s total floor area, you can claim 5% of your total cleaning costs. You can also use this deduction if the space is exclusively for work. If it’s a shared area, you cannot claim cleaning costs.

To calculate your cleaning expenses, you will need to determine the area of your home office compared to its proportion to your home’s total square meterage. 

If your home office is 15m2 and your home is 150m2, an annual cleaning cost of $2,000 equals a tax deduction of $200. In a shared-use scenario, you would need to consult your tax agents to be sure about your options, but they’re limited.

House cleaning for home-based businesses

There are significant tax advantages to operating a business from home, including deducting cleaning expenses.

To qualify as a home-based business, you need to partially or entirely operate your business from home, which means dedicated office space. Your home should be classed as the primary place of business, used for business, and you should have an ABN.

You can claim the cleaning costs for the room exclusively used for work. You can claim a proportion of the costs if it’s a mixed-use area. You can also deduct cleaning expenses if you use common areas for business, but the deduction must be proportional.

To calculate your cleaning expenses, you can opt for the fixed rate method, which is 67 cents per hour of operation, instead of using the floor rate method.

Eligible expenses include dedicated business office space cleaning and proportional cleaning in mixed-use or shared areas. Non-eligible expenses include cleaning expenses related to personal areas or occasional business use.

Situations where house cleaning may be deductible

Though tax-deductible cleaning expenses are typically associated with home business and rental properties, there are less common scenarios where these deductibles are relevant.

• If you operate a short-term rental, such as an Airbnb, you can deduct your cleaning expenses relative to its use. This includes the cost of preparing for a new guest or cleaning up after a guest checks out. If you rent out a room or only part of your home, you need to apportion the expenses based on the space rented out and the duration.
• If you occasionally use your dining room as an office, you can only deduct cleaning costs for the time it is used for business purposes.

What are some essential things to consider?

• You can’t claim personal cleaning expenses or general house maintenance unless related to a home office or income-earning property, capital improvements, or cleaning for personal use. In terms of capital improvements, this is a claim you can make over time through a decline in value.
• The biggest mistakes people make regarding house cleaning tax deductions are over-claiming, poor record-keeping, incorrect apportionment, ignoring Goods and Service Tax, and claiming personal labour. 
• Consulting with a tax professional is the safest way to avoid errors. They provide expert guidance to maximise deductions and avoid penalties for incorrect filings.
• Suppose you run a cleaning business or you’re employed as a cleaning professional. In that case, there are tax deductions for cleaners, such as washing your clothes, cleaning equipment maintenance, purchasing new cleaning equipment and any fees paid to your tax agents. 

How to claim house cleaning deductions in Australia?

Though using an accountant is highly recommended, you can lodge an online tax return directly with the ATO, including your deductions.

Ensure you keep detailed records, receipts invoices, and a log of what properties or spaces are used to generate income. Ideally, keep these bundled by the financial year in case of auditing.

You should be able to show your work when calculating your expenses and provide evidence of this to avoid fines or penalties. This is when working with an accountant is key.

Summing up

While there are plenty of deductible expenses for an individual’s tax filing, there are even more for those involved in home businesses or investment properties. 

From home office running costs and self-education expenses to phone expenses and furniture and furnishings, always consult a tax accountant for tips to ensure total compliance with ATO guidelines.

Learn more about Simply Maid. Check out our range of cleaning services, from end-of-lease cleaning to everything in between. And if you have any questions or concerns, we’ll be more than happy to assist.