Table of Contents
Maximising Your Tax Deductions: Essential Insights for Australians This Tax Season
As tax time unfolds in Australia, it’s crucial for taxpayers to ensure they’re claiming all available deductions. Historically, the average Australian taxpayer has claimed approximately $3,518 in deductions. Tax experts advocate for vigilance as many forget simple but beneficial deductions each year.
Alesha Masaud, director of Tax App, observes that common oversights include deductions for work-related assets and equipment. Under Australian Taxation Office (ATO) regulations, taxpayers can claim deductions for tools and equipment used in their professions. Masaud notes, “Anything that qualifies as an asset—such as laptops, phones, monitors, printers, scanners, office chairs, and filing systems—can potentially be claimed.”
For assets priced under $300, individuals can deduct the full cost in the year of purchase. However, for assets exceeding that threshold, depreciation must be calculated over the asset’s useful life. Taxpayers can utilise the ATO’s depreciation and capital allowance tool or calculate it manually using the prime cost or diminishing value methods.
Chartered accountant Fahad Gul, also from Tax App, highlights that taxpayers often miss out on claiming deductions for personal superannuation contributions. He warns, “Individuals who contribute to superannuation must lodge a notice of intent or risk missing a tax deduction.” Since superannuation is taxed at a flat rate of 15%, those in higher tax brackets may benefit significantly from these deductions.
The notice must be submitted to your super fund either by the time you lodge your tax return or by the end of the income year that follows the year of contribution.
To assist you in preparing your tax return, Masaud and Gul have put together a checklist of common tax deductions. As you gather your information, remember that having appropriate documentation, such as receipts, is essential to substantiate your claims.
Key Deductions to Consider:
- Vehicle and travel expenses (logbook or cents per kilometre).
- Home office expenses (fixed rate or actual costs).
- Work-related phone and internet expenses (proportional usage; avoid claiming if utilising fixed-rate work-from-home deductions).
- Tools and equipment used for work.
- Uniforms and protective clothing.
- Union fees or professional memberships.
- Work-related self-education expenses.
- Conference or seminar costs.
- Journals, trade subscriptions, or apps used for work.
Additional Deductions to Keep in Mind:
- Tax agent or accounting fees.
- Interest on investment loans.
- Income protection insurance (not inside superannuation).
- Donations of over $2 to registered Deductible Gift Recipients (DGRs).
- Bank fees on investment accounts.
- Dividend and share management fees.
Assets Eligible for Deductions:
Work and Office Equipment:
- Laptops, phones, and tablets.
- Monitors, printers, or scanners.
- Office furniture, including desks and ergonomic equipment.
- Job-specific tools or machinery.
- Storage or filing systems.
- Photography and recording equipment for content creators.
Home Office Assets:
- Vehicle depreciation (logbook method is necessary).
- Utes, vans, or motorbikes used for work (deprecation criteria apply).
The ATO provides occupation and industry-specific guides to help individuals identify potential deductions relevant to their respective professions.
In conclusion, as the deadline for lodging tax returns approaches, stay organised and informed. Utilising the insights from professionals like Masaud and Gul can save you a considerable amount on your tax bill. Ensure you keep meticulous records and seize the chance to claim every eligible deduction this tax season.
