ATO Puts Spotlight on Common Tax Return Claims by Six Million Australians

Over six million Australians are currently claiming tax deductions for work-related clothing and laundry expenses, prompting scrutiny from the Australian Taxation Office (ATO). As the ATO intensifies its examination of these claims, it’s vital to understand what you can legitimately claim when it comes to your work attire.

Guidelines for Claiming Clothing Deductions

The ATO allows deductions for specific categories of clothing and laundry expenses:

1. Occupation-Specific Clothing: This refers to attire that is inherently associated with your job.
2. Protective Clothing: Items such as fire-resistant attire, high-visibility vests, and safety boots, which are not worn for everyday purposes but are essential for certain jobs.
3. Distinctive Uniforms: Clothing that visibly identifies you as part of a profession or organisation, such as a chef’s checked trousers.
4. Clothing for Public Recognition of Occupation: Items that are easily identifiable with your job role, aiding public recognition.

Furthermore, for clothing to qualify as a deduction, it must meet specific protective standards relevant to workplace hazards. Examples include:

• Non-slip footwear for healthcare professionals
• Rubber boots suited for construction work
• Steel-capped boots and specialised uniforms that shield against soiling or damage while working.

What is Not Claimable?

It’s crucial to note that not all clothing is eligible for deductions. Common items such as:

• Everyday wear (e.g., jeans, business suits, or generic uniforms like plain white shirts) cannot be claimed.
• Uniforms or clothing purchased from a retail outlet that one can wear outside of work also don’t qualify.

If you work in a fashion retail setting, even if required to wear clothing from your store, you cannot claim expenses for these items since they are not specific to your job.

Compulsory Work Uniforms

You may claim deductions for compulsory uniforms that you purchase on your own without reimbursement from your employer. This generally applies to jobs like:

• Police officers
• Nurses
• Airline crew
• Retail staff

If shoes, socks, or other components are specified as part of a uniform designed for your position, these may also be claimable.

Non-Compulsory Uniforms

You can also claim deductions for non-compulsory uniforms if they are distinguishable and unique to your workplace. Uniforms must be designed specifically for your employer and not widely available to the public.

Laundry Expenses

You can further claim for expenses related to the cleaning of your work garments. If your laundry expenses total $150 or less and your work-related costs are $300 or less, you won’t need to present written evidence. The ATO provides allowances such as:

• $1 per wash if the load consists only of work clothing.
• 50 cents per wash if mixed with non-work-related clothes.

Conclusion

As the ATO steps up its scrutiny on clothing claims, it’s essential to be informed about what qualifies for deductions. By adhering to these guidelines, you can ensure that you are making legitimate claims on your tax returns, potentially saving yourself from future penalties. For the latest updates and information, you may consider following financial news platforms across social media.