This tax time the ATO is continuing to pay close attention to the $19.5 billion in work-related expenses claimed each year as deductions by individuals when they lodge their tax returns.
Incorrect expense claims are becoming easier for us to detect. To avoid your tax return being held up or reviewed this year make sure your deduction claims are correct.
What’s new this year?
This year the ATO will not be limiting its attention to particular occupations.
Instead, particular attention will be paid to work-related expense claims relating to:
- Deductions for personal expenses
- Failing to keep receipts or records
- Claiming for something never paid for
- claiming personal expenses for rental properties
- Work-related proportion of use for computers, phones or other electronic devices
As-well-as these areas of focus, we will continue to review incorrect or excessive claims for all other work-related expenses.
If taxpayers are claiming work-related expense deductions, they must have spent the money, they must be related to their job and they must have a record to prove it.
What do I need to do?
When completing your tax return this year, it is important to remember you can only claim the work-related expenses you are entitled to.
Some things you should consider are:
- You must have incurred the expenses in the year you are claiming them.
- The expense must be work-related and not private.
- If the expense has been reimbursed by your employer it cannot be claimed.
- Receiving an allowance from your employer does not automatically entitle you to a deduction.
- You need to keep records to support your claim. You can use records other than paper receipts; a full list of accepted records is available on the ATO website.
Common mistakes
- Making claims for home office, mobile phone and computer expenses without any evidence supporting how the claims were apportioned between private expenses and work-related expenses. The ATO recommends keeping a logbook recording business use & private use for 4 weeks!
- Incorrectly claiming travel between home and work as a work-related expense.
- Receiving a travel allowance and claiming the full amount without actually having spent that much.
Recent Comments