Claiming deductions is one of the best ways to reduce your taxable income and increase your refund. But with strict ATO rules and increased scrutiny, it’s important to know exactly what you’re entitled to — and what you’re not.
1. The Golden Rules for Work-Related Deductions
To claim a work-related deduction, all three of the following must apply:
- You must have spent the money yourself and not been reimbursed
- The expense must be directly related to earning your income
- You must have a record to prove it (usually a receipt)
2. Common Deductible Expenses
Here are some examples of deductions the ATO generally accepts:
✅ Vehicle and Travel Expenses
- Using your car for work (e.g., visiting clients or job sites — not commuting)
- Parking, tolls, and accommodation (if travelling overnight for work)
- Keep a logbook or use the cents-per-kilometre method
✅ Work-Related Clothing
- Protective gear (e.g., steel-capped boots, high-vis, gloves)
- Industry-specific uniforms
- Laundry and dry-cleaning of eligible clothing
✅ Home Office Expenses
- If you work from home, you can claim a portion of:
- Electricity
- Internet
- Decline in value of equipment
- Use either the actual cost, fixed rate, or shortcut (67c/hr) method
✅ Tools and Equipment
- Items used for work under $300 can be claimed outright
- Items over $300 must be depreciated over time
✅ Self-Education
- Courses directly related to your current job can be deductible
- Includes course fees, textbooks, travel, and stationery
✅ Union Fees and Subscriptions
- Union dues
- Professional memberships (e.g., CPA, Engineers Australia)
3. What You Can’t Claim
The ATO is strict on deductions that are personal or not sufficiently linked to your income.
❌ Travel from home to work
- Daily commuting is considered private, even if you work overtime
❌ Plain clothes for work
- You can’t claim suits, general clothing, or shoes, even if your employer requires you to wear them
❌ Home office costs if you just check emails
- Occasional admin tasks at home generally don't meet the threshold for a deduction
❌ Meal allowances without receipts
- Unless you are travelling overnight for work and get a proper allowance, meal expenses are private
4. Keep Your Records
Always keep:
- Receipts (paper or digital)
- Diary entries for work use
- Logbooks for car claims
- Invoices for larger items
ATO can audit up to 5 years back, so keep your documentation safe.
Final Tip
Even small claims add up. But incorrect claims can result in penalties. If in doubt, speak with a registered tax agent — they can help you claim everything you're entitled to without crossing the line.
Need help maximising your deductions?
Let our experienced team guide you through what’s claimable and ensure your tax return is fully compliant and accurate.
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