For many business owners, your mobile phone and internet connection are essential tools of the trade.
Client calls. Emails. Video meetings. Cloud software. Banking. Social media. Team communication.
So naturally, many people assume that if they use these services for business, the entire bill can simply be claimed as a tax deduction.
Unfortunately, it’s not always that straightforward.
And it’s an area where we regularly see business owners either overclaiming… or missing legitimate deductions altogether.
Can You Claim Your Mobile Phone and Internet?
In many cases, yes.
If you use your phone or internet connection for business purposes, you may be entitled to claim the business-use portion of those expenses.
The key words here are business-use portion.
If your phone or internet is also used privately — which is the case for most sole traders, company directors, and small business owners — you generally can’t claim 100% unless it’s genuinely used exclusively for business.
Where People Get It Wrong
Claiming the full bill “because I use it for work”
This is one of the most common mistakes.
Just because your phone is important for running your business doesn’t automatically make the entire expense deductible.
If you’re also using that same phone for personal calls, family messages, streaming, online shopping, or general day-to-day use, there’s a private component that needs to be considered.
Using rough guesses instead of actual records
We often hear:
“I’d say it’s probably about 80% business.”
The ATO generally expects your claim to be based on something more reliable than an estimate.
That might include:
- A usage diary over a representative period
- Itemised phone records
- Data usage reports
- Reasonable documented calculations
Without evidence, your deduction may not stand up if reviewed.
Claiming the household internet as fully business
This is especially common for people working from home.
Yes, your internet may be critical for your business.
But if the same connection is also being used by family members for Netflix, gaming, schoolwork, or personal browsing, there’s usually a private component that needs to be factored in.
What About a Separate Business Phone?
If you maintain a dedicated phone or internet service used exclusively for business, claiming those costs is usually much simpler.
Clear separation often means:
- Easier record keeping
- Cleaner bookkeeping
- Stronger substantiation
- Less stress at tax time
Sometimes a separate service can save more than just time.
Small Expenses Can Add Up
Phone and internet claims might seem minor compared to vehicles, equipment, or wages.
But overclaiming small expenses year after year can create unnecessary risk.
Underclaiming, on the other hand, means you may be paying more tax than you need to.
Getting it right matters.
Unsure What You Can Claim?
If you’re running a business, working from home, or using personal services for business activities, it’s worth reviewing how those expenses are being treated. If you would like to discuss a review, please contact our office to arrange an appointment.