8 Kinds of Deductions You Can Claim from Your Tax Returns

Posted on: 22 January 2015

When filing your tax returns in Australia, you can claim deductions for some expenses that directly relate your income. These allowable deductions are subtracted from your total income to arrive at the income. Allowable deductions must not include capital, domestic or private expenses. In cases where the expense is both work-related and domestic or private-related, you can only claim a tax relief for the work-related portion.

Discussed below are some of the work-related deductions allowed by the Australian authorities. To make a deduction claim, you must have incurred the expenditure in the course of earning your taxable income.

Travel and vehicle expenses

Trips from between your place of work and home are considered private travel and are, therefore, exempted from allowable deductions. However, trips and travel expenditures directly related to work can be claimed.

Clothing, dry-cleaning and laundry expenses

The costs incurred in purchasing occupation-specific clothing, unique distinctive clothing and protective clothing is exempted from taxation. However, expenses on typical work attire such as suits are considered a private and are not deductible from your taxable income.

Gifts and donations

You have at one time or another offered donations or gifts to other organizations in your official capacity. Gifts and donations can be taxable or tax-exempt depending on the status of the recipient. For gifts to deductible gift recipients (DGRs), you can make tax deductions.

Home office expenses

You may be eligible to claim deductions for home office expenses including electronics such as computers or phones that you are required to use for work purposes. Records for such must be kept to assist in the tax claim. Running costs for the home office equipment may also be deductible. As a general rule occupancy costs are not deductible for an employee.

Dividend, interest and other investment income deductions

If you incur expenses earning dividend, interest or other investment income, you can claim a tax deduction.

Self-education expenses

For studies that are work-related, you can claim a deduction. Recipients of taxable bonded scholarships can also claim a deduction.

Equipment, tools and other assets

If you buy equipment, tools and other assets to aid you in earning your income, you can make a deduction claim on all or some of the cost.

Other deductions

There are other several expenses that you can make a deduction claim on that are not mentioned above. As a basic rule, if the expenditure was to earn income, you can claim it—over time or as an immediate deduction.

To receive as large of a tax return as possible, consider talking to taxation services such as P. Stokes & Co (Aust) Pty Ltd.

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