Phone and Internet Business Use Calculator NZ 2026
Rules current for the 2026/27 tax year. Reviewed 5 August 2026.
Phone and internet is the deduction most often claimed and least often worked out. Part of the reason is that the two behave differently under New Zealand rules and people assume they behave the same. The landline is governed by a convention: if the line is also your private line, half the rental is deductible, full stop, with no apportionment exercise to perform and nothing to justify. The internet is the opposite. There is no set percentage, and Inland Revenue's position is that you choose the method as long as it gives a fair and reasonable result, which puts the burden of defending the number squarely on you. Business toll calls sit outside both and are deductible in full, as is a line or mobile used solely for business. The trap underneath all of it is the home office method. If you claim your home office using the square metre rate, that rate is already built from household utility costs including telephone and internet, and claiming them again on top relieves the same money twice. This calculator asks which method you are on first, because the answer changes everything after it.
How the claim is made up
The same bills under each home office method
Your figures, run through all three positions. The difference between the first two rows is the amount that the square metre rate has already paid you for.
| Home office method | Landline and internet | Tolls and business line | Total claim | Cash value |
|---|
Why the landline and the internet follow different rules
The 50 percent landline figure exists because apportioning a phone line honestly is close to impossible and Inland Revenue accepted that rather than pretend otherwise. It is a safe harbour: you take half, you keep the bills, and nobody asks how you arrived at half. Nothing equivalent exists for internet, because internet use can be measured in ways a phone line could not be when the convention was written. So the internet share is a judgement you make and stand behind. The practical consequence is that the two components carry different risk. If your return is reviewed, the landline half is not in dispute; the internet percentage is exactly the sort of figure that gets tested, and the strength of your position rests on whether you can describe the method you used.
The double claim that the square metre rate creates
The square metre rate is a per square metre amount covering the utility costs of running a home, gas and electricity, telephone and internet, and house and contents insurance, so that a person working from home does not have to apportion five separate bills. Inland Revenue's condition on it is blunt: if you use that option you cannot claim any other expenses in relation to the business use of your home. Mortgage interest, rates and rent are carved out, because the rate expressly excludes them, and they are claimed separately at the business proportion of the floor area. Telephone and internet are not carved out. They are inside the rate. Claiming the rate and then adding half the line rental and a share of the internet is not aggressive, it is arithmetic that counts the same money twice, and it is the single most common error in home-based sole trader returns.
Worked example
A GST-registered sole trader with $90,000 of profit claims actual home office costs. Their landline rental is $720.00 a year and is also the family phone, so $360.00 is deductible. Business toll calls of $180.00 are deductible in full. The household internet plan costs $1,200.00 and they have assessed business use at 40 percent on the basis of working hours, giving $480.00. A mobile used only for the business costs $600.00 and is claimed in full. The total claim is $1,620.00.
Because they are GST registered, $211.30 of that comes back through the GST return, leaving $1,408.70 deductible for income tax. Tax on $90,000 is $19,577.50; after the deduction it is $19,112.63. The claim therefore saves $464.87 of income tax, plus $24.65 of ACC earner levy on the same reduction in profit, so it is worth $700.82 in total.
Had the same person been claiming their home office on the square metre rate, the landline rental and the internet would both be inside that rate already. Their claim here would fall to $780.00, being the toll calls and the business mobile only, worth $325.57. The difference is not money lost. It is money the square metre rate has already given them.
How this is calculated
Landline rental is taken at 50 percent where the line is shared, and at nothing where the square metre rate applies. Business toll calls and a business-only line are taken at 100 percent under every method. Internet is the annual cost multiplied by the business percentage you enter, and is likewise removed under the square metre rate. GST, if you are registered, is three twenty-thirds of the claim, which is the standard way of extracting 15 percent from a GST-inclusive figure, and the income tax deduction is then the GST-exclusive remainder so that the same amount is not relieved twice. Income tax saved is calculated as the tax on your profit less the tax on your profit after the deduction, rather than by applying a single rate, so a claim that spans two brackets is relieved correctly. Rates are those in force from 1 April 2025: 10.5% to $15,600, 17.5% to $53,500, 30% to $78,100, 33% to $180,000, and 39% above that.
Related NZ calculators
- Home Office Apportionment Calculator for the square metre rate and the floor area method
- Deduction Value Calculator for what any single claim is worth
- Annual Deductible Expenses Calculator for the full year roll-up
- Logbook vs Kilometre Rate Calculator for the other big apportioned claim
- GST Calculator for extracting GST from a total