The Hidden Risks of Working from Home (WFH)

Working From Home (WFH) has been around for years. Since the COVID Pandemic, though, Australian organisations have embraced it to reduce expenses and offer employees a true work-life balance.
For workers, there are costs associated with WFH, like increased utilities usage and internet upgrades, often outweighed by the benefits.

But what about the not-so-obvious consequences? Those quiet, often intangible impacts?
Here are a number of hidden WFH traps that could potentially shape your career or long-term financial position.

1. Capital Gains Tax (CGT)

Under normal circumstances, your main residence is exempt from CGT. However, some finer, complex points could risk this exemption and result in a CGT liability.

According to the Australian Taxation Office (ATO), most WFH employees claim things like electricity, internet, phone, etc. using the ATO’s fixed-rate work from home method that wouldn’t usually create CGT problems.
Loopholes in regulations had enabled large tax deductions for some workers. Recently, the ATO closed those loopholes which could catch unsuspecting WFHers by surprise.

To understand the intricacies and ensure you protect your exemption status, it’s vital that you speak with your tax adviser before claiming any WFH expenses.

2. Out of sight, out of mind

That old saying is particularly relevant when discussing career progression.

A study conducted by social media organisation, LinkedIn, suggests that WFH can negatively impact career advancement opportunities through:

• invisibility due to lack of face-to-face interaction,
• reduced access to training,
• limited opportunity to demonstrate leadership,
• a sense of disconnect.

Fact is, if you’re a thumbnail image or a system-generated avatar on a computer screen, it’s difficult to stand out from the crowd.

Explaining a concept or showcasing your work can be challenging when not done face to face. Equally difficult is finding opportunities to display leadership skills or teamship.

If you’re the company newbie, there’s no quicker way to upskill yourself than to sit with a more experienced team member – something almost impossible for remote workers.

Job security

If your job can be done from your home, chances are it can be offshored, or worse, replaced by an AI chatbot.

Companies, always seeking ways to cut costs, are engaging skilled, inexpensive overseas contractors for an ever-increasing range of roles.

You know it’s been happening across many industries for years – think banking, telecommunications etc.. How do you prevent your job being offshored?

Start by proving your relevance and the value you add to the organisation by being visible.

Insurance

Regardless of where you work, your employer must maintain a safe working environment. So, what happens if you’re WFH and are injured? What if you’re injured on a break? Or you’ve logged off for the day?

It’s important that you know your rights and understand your obligations too. As WFH becomes more common, are we setting ourselves up for a legal nightmare?

Fair Work Australia and other regulatory bodies are paying close attention, but there’s still a lot of grey area.

Protect yourself with knowledge. Reach out to a tax or financial adviser about the financial implications. Speak to a professional specialising in workplace law to understand your rights and responsibilities. Schedule a chat with your HR Department about maximising your career opportunities.

WFH has its advantages, but make sure those advantages, enjoyed today, don’t negatively affect your future.

The information provided in this article is general in nature only and does not constitute personal financial advice.