ATO Warns Against Incorrect Claims | North Advisory

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    ATO warns against incorrect claims for work-related expenses

    Posted by Northadvisory on June 27, 2017

    The ATO is warning taxpayers to avoid incorrect claims for work-related expenses. Assistant Commissioner Kath Anderson noted that the ATO is using real-time data comparing taxpayers in similar occupations and tax brackets, which will enable them to identify higher-than-expected deductions claims.

    The ATO notes in particular that:

    • although receipts are not required for claims up to $300, it is a requirement that the taxpayer actually spent the money claimed, and taxpayers need to be able to demonstrate how they calculated a deduction of up to $300 if no receipts are retained
    • it is not generally allowable to claim a deduction for everyday clothes even if the style of clothes is specified for the employer and the clothes are only worn for work – to qualify for an allowable deduction, the clothes must be unique and distinctive (eg a uniform with the employer’s logo) or specific to the occupation and not suitable for everyday use (eg chef’s pants or coloured safety vests)
    • most employees will not be able to make claims for:

    o travel expenses for travel between home and work
    o car expenses for transporting bulky tools or equipment (unless the tools are needed for the job and the employer requires the employee to transport them)
    o car expenses that have been salary sacrificed
    o meal expenses for travel, unless the employee was required to work away from home overnight
    o the private portion of a trip that is both for work and for private purposes
    o private use of phone or internet expenses, or
    o self-education expenses for future or “dream” jobs”

    If you have any questions in regards to claiming work related deductions, please do not hesitate to contact us.

    Martin van der Saag
    T: 02 9984 7774

    Norman Ruan
    T: 02 9984 7774