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Work Related Expenses Claim For Individuals

When you perform a tax return, you have the right to claim for your business or work-related expenses as tax deductions with the aim to lessen your taxable income. ATO (Australian Taxation Office) uses this formula to calculate your taxable income.

Assessable income – tax deductions = taxable income

If you want to claim a deduction for your work related expenses, you must have:

  • the spent the money yourself
  • the expenses that are linked directly to earning your income
  • a record to prove these expenses, like must have the receipts of all the expenses to claim.

Also, keep in mind that if you have made these expenses for both your work and personal purposes, you have the right to claim the deductions for work-related expenses only. Also, the work expenses that your employer has reimbursed or will reimburse are not deductible. It is better to ask your employer if he/she may reimburse the expenses.

You can claim for work related expenses in the income year when you are being hired. It means if you are hired and start employment in August, you can claim deductions for work expenses you experience in August. This can be done even if you have not got your salary until the next income year.

You must know that in a situation when you have employed someone under you to assist you in your job responsibilities, this expense is not liable for claiming a deduction for employing another person. You can only claim a deduction for work related expenses that are related directly to earning your income.

If you have spent money as a part of or to receive your employment income, you have the right to claim a deduction for these expenses. You can also claim an immediate deduction or can claim deductions over several years, but it completely depends on the deduction.

As we have said earlier that you can claim a deduction for expenses you experience related to work only. These can be

  • Vehicle and travel expenses
  • Clothing and laundry expenses
  • Working from home expenses
  • Self-education expenses
  • Tools and equipment expenses
  • Phone and internet expenses
  • Overtime meals expenses
  • Income protection insurance expenses
  • Cash shortages or client bad debts
  • Glasses, contact lenses, and protective glasses expenses
  • Union fees and bargaining agents fees
  • Protective items expenses
  • Election expenses
  • Seminar, conferences, and training courses

Claim a deduction for car expenses

If you are using your own car to perform work-related jobs, it is considered under the car expense that you can claim. If you are using someone else’s car for work duties, you can claim for fuels, etc. Always remember that you can only claim a deduction for expenses that are related to work only.

When you use your car to perform your work job as an employee, you can claim a deduction if you:

  • carry bulky products or equipment required by your employer
  • are going to attend meetings, seminars, or conferences
  • travel from one workplace to another
  • perform itinerant work
  • collect supplies or deliver them to different places

Note:

You must know that if you are receiving an allowance from your employer to use your car as car expenses, it will add to your assessable income and be included in your tax return.

Claim a deduction for clothing and laundry expenses

Do you require wearing a suit or special clothing to work? If you need special equipment or clothing to perform your work jobs, you can claim a deduction for the expenses to buy it. This can be anything from a unique uniform to occupation-specific clothing.

If you receive clothing and laundry allowance from your employer, you must declare this amount in your tax return. It means you have no right to claim for the cost of purchasing or cleaning clothes for your job, but they are not liable for your occupation.

You can claim a deductible for clothing, including footwear that you wear while performing your work duties, and protect yourself from any kind of injuries.

Claim a deduction for equipment, tools, and other assets

If you spend money on buying any equipment and tools to earn your income, you have the right to claim a deduction for this expense. When the same equipment is used for work as well as personal purposes, you will be able to receive a deduction for only 50% of the expense.

These equipment can be tools, technical instruments, computers, laptops, software, safety equipment, etc. Do you know that you can also claim for the cost of repairing these tools and equipment?

Claim a deduction for self-education

 

If you are studying related to work, you have the right to claim a deduction for self-education expenses. You must also know that the currently pursuing a course must be connected directly to your current employment. The course must be such that it helps in improving your specific skills and is more likely to increase the chances of improving your income from your employment.

But, when you claim a deductible, you must have all records of all the expenses you have claimed during self-education. ATO always asks for valid evidence to support your claim, no matter what it is.

It is true that most tax deductions have become more complicated than reviewing their brief. So, everything must have valid proof.

How to make a valid claim for work related expenses?

ATO does not entertain incorrect work-related expense claims. Therefore, you must make sure that:

  • Your claim is justified
  • You were not reimbursed already
  • You are getting a professional advice
  • You have all valid evidence to support your claims
  • Your all claims are relevant to your work duties
  • You know what is and what is not deductible
  • You have receipts of all expenses

If you are confused about your expenses and how to claim a deduction, the best idea is to take the help of a professional for the right guidance and to make things easier. A registered tax agent can help you with a wide range of tax and accounting services and make the entire process of claiming deductions stress-free.

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