Home Office Expense Calculator
Working from home for a business or side hustle? IRD lets you choose between a fixed per-square-metre rate or apportioning actual home expenses. This calculator runs both methods side-by-side so you can pick the one that gives the bigger deduction.
Floor area used regularly and exclusively for work.
Total floor area of your home (including the office).
Used to estimate your tax saving — leave blank to see the deduction only.
Enter your annual home expenses. We'll apportion them by your office's floor-area % and compare against IRD's square-metre rate. If you skip this, only the fixed-rate method applies.
For homeowners, interest only — not principal repayments
Annual rates bill
Building / contents premium
Annual electricity + gas
Full annual bill (apportioned by floor-area %)
Landline / mobile annual
General home upkeep (not capital improvements)
Square-metre rate vs actual cost
IRD's square-metre rate (Income Tax Act 2007 s DB 18AA) is a published $/m² figure updated annually. For 2024-25 it's $53.10/m² (DET 24/01). The rate is intended to cover utilities, rates, insurance, and depreciation on the office portion of your home — but NOT rent or mortgage interest, which you claim separately.
The actual-cost method apportions all your home running costs by the floor-area % of your office. For example: if your office is 10% of your home and your annual home expenses total $35,000 (rent, rates, insurance, power, internet, repairs), the deduction is $3,500. Compare against fixed-rate ($53.10 × 10 m² = $531) — actual-cost wins by a wide margin when rent / mortgage interest is high.
Whichever you pick, the space must be used regularly and exclusively for the business. IRD doesn't accept "I sometimes work at the dining table" — there needs to be a dedicated room or partitioned area.
Frequently asked questions
Can I claim home office expenses as a PAYE employee?
Generally no. NZ doesn't have a salaried-employee home office deduction like Canada or the UK. Some narrow exceptions exist for employees on formal WFH agreements where a portion of pay is explicitly allocated to working from home, but most employees can't claim.
Do I need to use a separate room?
A separate room is the cleanest. A partitioned area also works if it's used regularly and exclusively for the business. A shared dining table or living-room corner doesn't qualify — IRD is strict on the 'exclusive use' test.
Can I claim both methods to maximise the deduction?
No — you pick ONE method per year. You can switch between years if your circumstances change (e.g., move house, change office size), but not within a single tax year.
What about rent and mortgage interest under the fixed-rate method?
The square-metre rate doesn't include rent or mortgage interest. You can claim the office-portion of those separately on top of the fixed-rate deduction. The actual-cost method bundles them in, so it usually wins for renters and homeowners with significant interest expense.
Will IRD ask for proof?
For the fixed-rate method, IRD only needs your office area and total home area. For actual-cost, keep receipts and a floor plan — IRD may request evidence of the apportionment if your return is reviewed.
Related calculators
Sources
Square-metre rate from IRD — Using your home for your business. Rate set by IRD Determination DET 24/01.