Tax Deduction FAQ (Frequently Asked Question)


I need to purchase tools and equipment for my job. What would i be able to claim on my tax?

You are able to claim expenditure incurred in replacing, insuring and repairing tools of trade that you use for earning your income. If the cost of any item is more than $300, it will have to be depreciated (i.e. claimed over its effective life). The amount you can claim will depend on what receipts you have kept and to what extent you use it for income producing purposes. If you are in the situation where you are wondering what you can claim without receipts, you can claim less than $300 without proof of purchase.

You have 28 days to correct this information. However, on the off chance that you have excluded the taxable income, you won't have to contact the ATO. They will change your return and send you new assessment requesting payment of the extra tax, a general interest charge and, in some cases, punishments. On the off chance that you require help with your correspondence with the ATO, Indus Accounting can help.

My job requires me to keep my knowledge up to date and I buy books and journals. Can I claim them all?

If technical books, trade books or journals are necessary to fulfill your job function efficiently, the cost of their purchase is tax deductible.

Can I claim a deduction for sun protection items?

A deduction is available for outdoor workers who buy sunscreen lotion, sunglasses and hats for use at work. The claim must be substantiated and apportioned for private use.

I have a job which requires me to be on the road a great deal and I have to use my own car. What do I need to do so that I can claim a tax deduction for my car?

There are four different methods for claiming work related motor vehicle expenses and each have different record keeping requirements. To use the method that ensures you the best claim it is advisable to keep a log book and all receipts for expenses (e.g. insurance, registration, repairs, services, tyres, etc.). You do not have to keep receipts for petrol as Indus Accounting can work that out for you using a yearly average formula.

It is not necessary for you to use the same claim method each year. The choice of method should be made on the basis of which is more favourable to you and which you have the appropriate records for. If you don’t have a current logbook or have not retained all receipts you will be limited in which method you can choose. You cannot, however, claim any car expenses if your car is salary packaged.

I am expected to maintain a well-groomed appearance at work. Can I claim these as tax deductions?

Expenditure on personal grooming and haircuts are generally not deductible. There are exceptions for some taxpayers involved in the performing arts field.

My employer expects me to wear specific clothing for work? What would I be able to claim on my tax?

Compulsory uniforms are generally deductible provided they identify you as an employee of that organisation or in a specific occupation. A requirement to simply wear particular colours is not enough to make the clothing deductible (for example a waiter being required to wear black and white clothing) nor is a requirement to wear a store’s own brand of clothing (they are still conventional clothing and not tax deductible). Corporate wardrobes are also deductible if certain conditions are met. The uniform design must be registered with AusIndustry. Provided that the clothing is deductible then you may also claim maintenance costs (laundry, dry cleaning and repairs).

I work in a fashion clothing store and am required to wear the clothing that is sold in the shop. The garments have the manufacturer’s logo on as part of the design and I buy them at a discount. Can I claim the cost of this clothing?

Fashion clothing is not tax deductible even if your employer requires you to wear it. Because the logo is a part of the design of the clothing and does not in itself identify you as an employee it will still not be claimable.


I have incurred travel expenses this year. What can I claim on my tax?

Your travel must be relevant to your job function for you to be eligible to claim a deduction for those expenses. Where this is the case, and you have the necessary documentation, you can claim the cost of transport and incidentals. If your travel involved an overnight stay you would be able to claim for meals. Travel overseas also requires you to keep travel diary.

I am paid an allowance for travel. Can I claim a deduction for that on my tax return?

A deduction will only be allowed if you have actually incurred a work-related expense and have the necessary documentation. Travel to and from your job is generally not claimable unless, for example, you are carrying bulky equipment. Some awards allow for a payment of an allowance even though an expense is not necessarily incurred by the employee. If a deduction can be claimed it cannot be for more than the expense that you incurred even if the allowance that you have received was higher.

I had an overseas holiday during the year and while I was away attended a seminar that was relevant to my job. Can I claim the cost of the trip?

You cannot claim the cost of the trip because the main purpose was to have a holiday and attendance at the seminar was incidental to this. You will only be able to claim the additional expenses that you incurred to attend the seminar. These could include the registration fee, taxi fare to the seminar, etc.


I need to have a telephone for making and receiving business calls and would like to know what I can claim.

Installation costs are not deductible. However, part of the rental costs are deductible where a taxpayer is required to make calls from home. Call costs would be deductible and a log of calls must be kept for a minimum of 4 weeks. Mobile phones are claimed in the same way.

This year I bought a laptop and new mobile phone which I need for my work. Can I claim the cost of these on my tax return?

Items like this that you buy for use in your job can be claimed in your return. However, since the cost of these items is most likely to be more than $300 each you will not be able to claim the full cost in one year.

It will be necessary to spread your claim over the useful life of the items (depreciation) and only the work-related proportion is claimable. You should keep a log of work related use for a period of at least four weeks for each item to determine the proportion that you can claim.

I recently bought an iPad and have been using it for work. Will I be able to claim a tax deduction for the cost?

The ATO have confirmed that the iPad will be treated as the equivalent of a laptop. If it is used to produce assessable income (i.e. for work related activities) a claim could be made. Any claim will have to be adjusted where there is private use and if the iPad cost more than $300 the work-related proportion would have to be depreciated over its effective life. You should keep a log of work related use for a period of at least four weeks to determine the proportion that you can claim.


I have had to pay for child care during the year. Is this claimable on my tax return?

Child care expenses are not claimable as a tax deduction. Eligible taxpayers may be able to claim the Child Care Tax Rebate (CCTR) through the Family Assistance Office.


Is there a limit on how much I can claim as a tax deduction each year?

There is no limit on the amount claimed each year, provided the expenses are necessarily incurred in earning your income. The expenditure must be work related and you may need receipts to substantiate the expenditure. Keeping incomplete, incorrect or no records at all may be limiting your ability to claim deductions. Advice can be obtained from a registered tax agent. Indus Accounting are happy to advise their clients on appropriate record keeping that will enable them to maximise their allowable deductions.

Is a credit card slip acceptable as a receipt?

Provided it gives full details of the supplier and date of purchase the tax office would accept a credit card slip as proof of purchase. Taxpayers can make a notation on the document indicating the type of goods that were purchased. Many taxpayers use the internet to purchase or pay for their work related expenses and so the ATO will also accept pay or email receipts provided they contain the necessary information: date, supplier, nature of the goods and the amount.

How long do I need to keep my receipts?

Documentary evidence should be kept for five years from the date of lodgement of the tax return in which the claims are made. If you are depreciating an asset the receipt should be kept until the item is fully depreciated (even if over 5 years).


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