Although Tax Season occurs each year, not everyone is aware of what they are allowed to claim in respect of work-related expenses. As a result, many legitimate deductions are never claimed, meaning that the Australian Tax Office benefits from more of your money than necessary. Below are some of the most commonly forgotten tax deductions, some of which could result in you legally pocketing a few hundred or even thousand dollars extra per year.
1. Membership Fees
Professional association membership fees and union fees are often forgotten about when it comes to filling out a tax return, especially if they are paid in advance at the start of the year.
2. Income Protection Policies and Plans
Owing to the fact that this is usually hidden within a life insurance policy, many taxpayers forget to claim this legitimate expense each year. The only exception to this is when your income protection insurance premiums are within a superannuation fund.
3. Vehicle Depreciation
Although most taxpayers who use vehicles to run their businesses are aware that they can claim deductions such as petrol, registration, insurance and servicing if they keep a detailed logbook, a large number either forget or are not aware that they can claim depreciation on the vehicle itself as well. In most cases, this can amount to 25% of the written-down value at the beginning of the year.
4. Work-Related Vehicle Usage
While it is not permissible to claim vehicle costs for any travel to and from your place of work, many other forms of work-related tax-deductible vehicle use are forgotten about. For instance, if you have to deliver an item to a client or visit another site, you are allowed to claim those costs. Provided that you can show how you have worked out your claim, you will not need to keep a logbook if you drive fewer than 5,000 kilometres annually.
5. Home Office Energy Expenses
More Australians than ever now work from home, but they aren’t all aware that they can claim a portion of gas and electricity costs that are associated with home office use. At present, the allowed amount for deduction in this regard is 45c per hour for energy. You will have to be able to justify your claim in this regard though.
6. Mobile Phone Costs
Any work-related use of your mobile phone is tax-deductible, and in many cases, you can also claim a percentage of your phone plan charge as well. However, you will need to keep accurate records of what is work and what is personal use on your mobile phone – unless it is strictly for work use.
7. Journals, Magazines and Books
As most business owners know, subscription rates for business-related magazines, journals or books can amount to a few hundred dollars per month. The good news is that these are also tax-deductible if they are directly related to your current employment.
If you would like to find out more about preparing your tax return, contact us today. We will be more than willing to assist you.