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Nick has a place of work but often chooses to work from home at night...

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Accounting

Nick has a place of work but often chooses to work from home at night to ensure his business finances are kept up-to-date. Nick determines his home office occupies 5% of the house.

His expenses incurred during the year in relation to the house are as follows:

  • Electricity totalling $1,200
  • Mortgage repayments $25,000 (interest is $15,000 and the remaining capital)
  • Rates and taxes totalling $3,750
  • Water expenses totalling $500

Based on the above facts and relevant tax laws, what amount can Nick claim as an allowable deduction regarding the home office? (select the best answer)

A $1,023
B $60
C $0 he has a place of work
D $273

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