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Tax year end – Top 10 common claimable tax expenses
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Tax time – it’s ‘Christmas in July’ for many Australian taxpayers, a time of year when your diligently paid taxes and well kept receipts can pay off in the form of a sizable refund.
The average Australian work-related expenses claim is around $1900 – yet there are still many claimable expenses being borne by taxpayers because they either didn’t have the evidence to substantiate a claim, or because they simply didn’t know that an expense was deductible.
Today we look at ten common claimable expenses that people are missing out on.
- Medical expenses
For most of us, there is no relief from dental and optometrist bills during the year. However, if your entire family’s out of pocket expenses were more than $1500 during the year, you can claim a tax offset of 20c for every dollar over $1500. - Expenses for the home office
If you work from home, even if you don’t have a defined space for doing so, you can claim a portion of your power bills for things like heating, cooling and lighting. It’s safest to keep a diary to substantiate your usage patterns, though. - Cost of preparing your tax return
Most people claim the cost of actually having their return prepared; however if you have travel costs or record keeping costs (stationery, filing) associated with preparing your tax return, these are deductible expenses also. - Education Tax Refund
This is a new deduction this year, and helps offset the cost of educating your children. You’ll be able to claim for computers, software, internet access, stationery and prescribed textbooks. Any items shared between educational and non-educational purposes will need to be apportioned. See www.educationtaxrefund.gov.au for more detail. - Dependant spouse rebate
If you have a dependant spouse earning less than $9000 per year, with the main breadwinner’s income less than $150,000 per year, you could get up to a $2200 deduction. - Donations
They are awkward and fussy to account for, but well worth claiming. Donations to a registered charity for over $2 are tax deductible. Important to remember to request a tax invoice when you make these donations. - Senior Australians tax offset
If you meet certain age, income and pension eligibility related criteria, this tax offset will increase the amount you can earn before being taxed, and before having the Medicare levy applied. - Income protection insurance
This is one of the few forms of insurance that is claimable in every circumstance, and one that it will be easy to find your evidence for. Don’t miss out! - Uniforms and work clothing
If your work clothing has a company logo on it, or has an associated safety purpose (such as steel toed boots, sunglasses for outdoor workers, overalls or high-visibility gear), you can claim its cost, as well as laundry expenses of up to $150 per year, on your tax return. - Bank fees
An account used for deductible expenses may be eligible to have the fees reduced with a tax deduction. They would usually need to be apportioned between business and non-business use, though.
If you take the time to go through your bank and credit card statements with your accountant this year, and check whether you’re eligible for these common deductions, you could be having a much bigger party for ‘Christmas in July’ this year.
Ask us, your mortgage broker in Melbourne about using your refund to reduce your home loan account … and you could also turn a few thousand dollar refund into tens of thousands over the life of your mortgage. That tax refund dollar could go further than you think!
DISCLAIMER
This article is intended for general advice only. You should consult your accountant or tax adviser whether any of the above deductions are relevant for your personal circumstance.
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