What not to claim on your tax return?
The Australian Taxation Office (ATO) is cracking down on taxpayers claiming over $2 billion in questionable “Other Work-Related Deductions.” If you're not careful, you could be in their sights.
In principle, if an expense directly relates to earning your income, it can be claimed. However, in practice, many common expenses are not deductible, and claiming them could trigger an audit.
Here are the top four expenses taxpayers mistakenly claim:
1. Childcare Costs
Non-deductible: School fees, daycare, school uniforms, and any general cost of raising children are not deductible. These are considered private expenses, even if childcare enables you to work.
2. ATO Penalties
Trying to claim a tax penalty on your return? Don’t.Non-deductible: ATO-imposed penalties for late lodgement or non-compliance cannot be claimed.Deductible: ATO general interest charges (GIC) can be claimed—make sure to separate these correctly.
3. Travel from Home to Work
Non-deductible: Your daily commute, no matter how far, is considered private travel—even if you're answering work calls on the train.Exceptions apply, such as:
Carrying heavy tools directly related to your job
Working at multiple sites
Travelling between jobs during the same dayGet professional advice before assuming your travel qualifies.
4. Professional Attire
Non-deductible: That sharp suit or designer heels may impress clients, but unless it’s a compulsory uniform with a logo, you can't claim it.Deductible: Industry-specific items like:
High-visibility vests
Steel-capped boots
Logo-embroidered workwearare generally allowed.
The $300 Rule: Don’t Get Complacent
Yes, you can claim up to $300 in work-related expenses without receipts, but you still need a reasonable explanation for each item. The ATO has access to data-matching tools, so even a small red flag can lead to further questions.
Need Expert Tax Advice?
Don’t risk it. At Dolman Bateman, we help individuals and businesses get it right the first time. If you're unsure what you can claim, speak with one of our expert accountants today.
📞 Call us on +61 2 9411 5422
Disclaimer: The information provided in this article is general in nature and does not constitute personal financial, legal or tax advice. All content relates to the current financial year only. Future changes to tax laws, thresholds or administrative requirements may affect the accuracy or relevance of this information, so you should always confirm that the guidance remains current. While every effort has been made to ensure accuracy at the time of publication, Dolman Bateman accepts no responsibility or liability for any loss or damage arising from reliance on this information. You should seek professional advice tailored to your circumstances before making any financial or tax decision.
