Many employees may miss out on deductions because they are not aware which costs they are entitled to claim for tax. 

To help employees with their tax return this year, Airtax has created this essential checklist of 10 tax deductions.

It has become increasingly common for employees to do some of their work from home in recent years.

For the hours you work at home, you may be able to claim a deduction to cover expenses such as electricity, cooling and heating (ie running costs). 

Having a dedicated work area at home (e.g. in a spare room) increases the amount that can be deducted. 

In the 2022-23 financial year a deduction can be claimed even without a dedicated work area at home. 

To claim a deduction for these expenses, all you need to do is estimate the number of hours worked from home. This is then multiplied by the relevant rates for the period the hours were worked. 

When working from home, employees may also use their internet at home to do their work. If so, employees may claim a deduction for their home internet costs. 

It’s unlikely that the whole internet bill can be deducted because home internet is often also used for personal use. There are two different approaches to calculate how much of a home internet bill can be deducted.

Employees commonly have their own mobile phone (i.e. not a company phone) and use it to do their job.  

Like internet bills, if a mobile phone is used for both work and personal use, then only the work related portion can be deducted. The same approaches used for calculating how much to deduct for an internet bill can be used for a mobile phone bill. 

Employees may purchase equipment for their home office such as a desk, chair or lamp. 

The cost of purchasing home office equipment is deductible if the value is less than $300. If the equipment costs more than $300 the employees may be able to claim depreciation. 

Common computer equipment purchased by employees includes computers, laptops, monitors and printers. 

Similarly to office equipment, the purchase of the computer equipment can be deducted if it costs less than $300. If the cost of the equipment is more than $300 then the purchase cost cannot be deducted, but depreciation can be deducted.

Employees may need to drive their car for work and if they do they may be able to claim a deduction for the running costs for their car. 

Whilst trips between home and work cannot be deducted, trips between one place of work to another may be deducted. For example, travelling from an employee’s regular place of work to a customer’s office. 

The amounts that can be deducted will depend on the number of kilometres travelled for work and whether a logbook record is kept. Whilst it is not necessary to keep a logbook, it can increase deductions. 

In addition to car expenses, employees may have other travel expenses. These may include tolls, public transport or food.  

Travelling between home to work cannot be claimed, travel from your place of work to a customer’s office may be able to be claimed. 

Whilst the cost of meals that would regularly be consumed whilst at work cannot be deducted, meals whilst travelling away overnight for work can be deducted.

These can include meals whilst interstate for work where the meal cost has not been rolled into your salary under an industrial award. Where you receive an allowance for travel these rules can get a bit tricky and you may like to seek further advice.

It is common for employees to undertake further education to advance their skills and expertise. This can take many forms such as a once off online course or even a masters degree and many qualifications in between. 

To be able to claim a deduction for education, the course must have a sufficient connection with your current role. For example, a marketing manager may be able to claim the cost of a digital marketing short course. 

The amounts that can be deducted may go beyond tuition fees. Travel to the place of study, meals whilst at the place of study, textbooks and online subscriptions may also be deducted. 

Employees may purchase items to use specifically for work for which they are not reimbursed.

These items may include stationary for taking notes at meetings, hand sanitiser to maintain hygiene in the office or even sunscreen for sun protection if required to work outdoors. Such items may be deducted in your tax return.

Some employees may have used the services of a tax accountant like Airtax to help them prepare and lodge their tax return in the prior year. 

The amount paid to the tax accountant can be claimed as a deduction in the year that it is paid.

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