To deduct or not to deduct, that is the question?

 

 

 

It’s important to take the time to understand what expenses you are entitled to claim against your taxable income and remember that spending the money is only half of it, you must have proof of the expenditure and be able to substantiate to the ATO how it relates to your work.

In order to claim a work related deduction, the expense has to be legitimate and relate directly to your income producing activities. You must have spent the money yourself and not received a reimbursement for it. So with that in mind, let’s have a look at some of the common deductions you may be entitled to claim.

General work related expenses

If you spend money on any of the following (but not limited to) you may be able to claim a deduction for:

  • Telephone, mobile or internet costs
  • Union, licence, or membership fees to a professional or governing body
  • Home office running costs
  • Conferences or seminars
  • Self-education fees
  • Income protection insurance (where not a part of a superannuation fund or salary sacrifice arrangement
  • Motor vehicle and travel costs
  • Equipment and tools
  • Uniforms
  • Stationery
  • Travel and accommodation
  • Technical journals and books

Non-work related deductions

Now where it gets a little more exciting for us tax enthusiasts - were you aware that you could potentially be eligible to claim expenses that aren’t even ‘work related’ as well? These could include expenses like donations made to registered charities, the cost of keeping up with your tax affairs, and also interest paid on some investments.

Clothing, Uniforms & Laundry

One of the common misconceptions surrounds the deductibility of work uniforms.  There are specific guidelines that your work uniform is required to meet, before a tax deduction can be claimed for its purchase or laundering.

For compulsory work uniforms to meet these guidelines, the clothing must have a visible logo and be distinct to your employer or workplace. So unfortunately, those black pants, black shoes, blouses or business suits are not deductible unless embroidered, even if they are only used for your work.

Further Information on Work Related Expenses

To find out more information on claiming deductions for the 2018 financial year, follow the below link:

https://www.ato.gov.au/Individuals/Tax-return/2018/Tax-return/Deduction-questions-D1-D10/Claiming-deductions-2018/

or contact one of the Halpin Partners team to have a chat about deductions you may be eligible to claim this year.