June 15, 2022

2022 Work-Related Tax Deduction Checklist

The end of the financial year is fast approaching, so now is probably the time that you start looking for ways to save in this year’s tax return. Whether it’s through tax deductions, work expenses that you could bring forward or via the various tax offsets the government introduced. Looking to DIY your personal income tax return but getting a little overwhelmed? Let’s cover the basics with our tax deduction checklist.

Upon completing a tax return, individuals are entitled to claim deductions for expenses that are directly related to their income. These can come in a variety of forms, but must be work-related – thus claimable expenses differ between professions. There are three requirements an individual must meet to claim a work-related tax deduction:

  1. the individual must have spent their own money and not received a reimbursement from their employer for it
  2. the expense must be related to their job
  3. there must be a record, like a receipt, to be able to prove it

If an expense was for work and private purposes, individuals can claim a tax deduction for the work-related portion of the expense.

Here’s a breakdown of the most common deductible expenses employees and rental property owners can claim this financial year:

Home Office Expenses

The past year may have seen you working from home more than ever before, and setting up a home office may have incurred a number of additional expenses. Some of the expenses that you may be able to claim as tax deductions include:

  • Phone and internet expenses
  • Computer consumables (such as printer paper and ink) and stationery
  • Home office equipment (such as computers, phones, printers, furniture, etc)

With home office equipment, you may be able to claim either:

  • the full cost of the items (if less than $300 in value)
  • the decline in value (also known as depreciation) for items over $300

Unless you meet very specific requirements, you won’t be able to claim for home expenses such as mortgage interest, rent and rates, or the cost of general household items. 

If you plan to use the temporary ATO approved ‘shortcut method’ (80 cents per hour for all additional running expenses) to claim your deductions, you cannot claim any other expenses for working from home for that period. For example, if you purchased a desk to use when working from home, you cannot claim a tax deduction for that separately as it is covered by the 80 cents per hour work rate. The deadline for this method of calculation is 30 June 2022 (unless it is extended). 

Clothing Expenses

Individuals can make a claim for work-related clothing expenses including compulsory, non-compulsory and registered uniforms, occupation-specific and protective clothing, and expenses associated with work-related clothing, such as dry cleaning, laundry and repair expenses.

Self-education Expenses

Individuals can prepay self-education items before the end of the income year, including:

  • course fees (not HECS-HELP fees), student union fees and tutorial fees
  • stationery and textbook purchases

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Other Work-related Expenses

Individuals can prepay the following expenses before 1 July 2022:

  • union fees
  • seminars and conferences
  • subscriptions to trade, professional or business associations
  • subscriptions to magazines and newspapers

If you are looking for assistance in working out potential expenses that you could incur prior to the end of the financial year, have queries about your claims or just want to prepare for 30 June 2022, contact us today. Whatever your tax situation, we’re equipped and ready to ensure you stay on top of your tax compliance responsibilities—and on the right side of the ATO, with our tax and business advice.

Filed Under: Compliance, Small Business Tax

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