The key rule in claiming deductions from expenses on your tax return is that it must be directly related to earning your income and not private in nature. The ATO usually look at both form and substance in their deliberation. If the expense was both work-related and private or domestic, you can only claim a deduction for the work-related portion.
Here are some common deductions claimed:
You can claim vehicle and other travel expenses directly connected with your work, but you can’t claim for normal trips between home and work – this is considered private travel.
You can claim a deduction for the cost of buying and cleaning occupation-specific clothing, protective clothing and unique distinctive uniforms.
You can only make tax-deductive gifts or donations to organisations that have the status of deductive gift recipients (DGRs).
You may be entitled to claim deductions for home office expenses, but you must keep records. Running costs may be deductible. Occupancy costs are generally not deductible for an employee.
You can claim a deduction if you are able to show that you incurred expenses earning interest, dividend or other investment income.
You may be able to claim a deduction for self-education expenses if your study is work-related or if you receive a taxable bonded scholarship. In some circumstances, you have to reduce the amount of your claim by $250.
If you buy tools, equipment or other assets to help earn your income, you can claim a deduction for some or all of the cost.
You may be able to claim other deductions not previously mentioned. As a rule of thumb, if you need to spend money to earn income, you can usually claim it – either as an immediate deduction, or over time.
For a more comprehensive list of deduction, book an appointment with one of our tax consultants today!
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