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Home Office Deductions Guide — Claim Rules and IRD Rates for NZ

the home office expense deductions in New Zealand. The guide covers the IRD-approved standard cost method ($0.84 per hour from the 2025-26 year), the actual cost apportionment method, the floor area percentage calculation, and the record-keeping requirements.

Standard Cost Method

The IRD provides the standard cost method for the home office claims — the fixed rate per hour of the actual home office use. For the 2025-26 tax year, the rate is $0.84 per hour. The method covers the heating, the lighting, the rates, the insurance, and the general home maintenance. The method does not include the phone and the internet costs — those are claimed separately as the business expenses. The claim is limited to the actual home office hours worked and does not require the detailed floor area measurements. The standard cost method is available to the self-employed individuals and the employees working from home.

Actual Cost Apportionment

The actual cost method requires the apportionment of the actual home expenses based on the home office floor area as the percentage of the total home floor area. The deductible expenses include: (a) the rates, (b) the insurance, (c) the power and the gas, (d) the repairs and the maintenance, and (e) the mortgage interest (subject to the Interest Limitation Rules for the rental properties). The depreciation on the home office furniture and the equipment may also be claimed. The method requires the detailed records and the floor area documentation. The home office must be the dedicated work area used regularly for the business. See our Business Expenses Guide → for the comprehensive deduction rules.