Four common tax deductions most Aussies overlook

The tax office is watching expense claims closely this year, but there are deductions people often miss. 

Jul 09, 2024, updated Jul 09, 2024
The ATO has warned taxpayers who fail to provide evidence of work expense claims will be in its sights for additional scrutiny.

The ATO has warned taxpayers who fail to provide evidence of work expense claims will be in its sights for additional scrutiny.

Tax time has arrived and millions of Australians are mulling their upcoming refunds.

H&R Block director of tax communication Mark Chapman said most taxpayers should expect a similar refund to what they got last financial year, as long as their personal situations hadn’t changed.

Both will be smaller than the year before that when the expiration of the low and middle-income tax offset combined with changes to remote work expenses meant that many Australian workers pocketed less.

“I’d hope that most taxpayers have got used to the new system [for remote work claims] this year,” Chapman said.

“There might possibly be a slight increase in some returns because of that.”

Get it right

The new work-from-home arrangements and a tax office focus on ensuring more taxpayers get their returns right mean Australians need to think carefully before lodging their return this year.

The Australian Taxation Office has warned taxpayers who fail to provide evidence of work expense claims, including those related to remote work, will be in its sights for additional scrutiny.

It has also advised taxpayers to wait a few weeks to file their returns, suggesting that those who rush to get their refund before pre-fill information is available could face delays or penalties.

Little-known deductions

Luckily, there were a handful of deductions that many Australians overlooked that could be prepared in the meantime, Chapman said.

First, millions of Australians either pay union or professional association fees each year.

Far fewer claim those fees on their tax.

These fees are claimable, and that’s not all, according to Chapman – you can also get deductions for subscriptions to trade, professional or investment (if you’re an investor) magazines too.

Second, many Australians don’t realise that the cost of having their return done by an agent is itself deductible in the following tax year.

If you had your taxes done professionally last year, make sure to claim that in your return this time around.

If you’re getting them done by an agent this year, you can claim that next year.

Interestingly, you’re also able to claim any expenses you incur for travelling between your home and the meeting place with your tax agent. So don’t forget those costs either as they can stack up.

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Third, income protection insurance can also potentially be claimed, provided you’re paying for it yourself, Chapman said.

Rental claims

Lastly, Australians with rental properties also often forget that they’re able to claim an array of expenses related to their investments beyond just the interest paid on any attached home loan.

Chapman said there were “dozens” of potential claims, including lawn mowing or pest control fees.

However, you’ll want to be careful and speak to your tax adviser because the ATO is keeping a close eye on landlords this year amid fears most are making mistakes on their tax returns.

Developing good tax habits

Chapman said the key for all taxpayers was to develop good habits. That can begin from today by preparing for next year’s taxes.

“You’ll find the whole process of completing your tax return so much easier if you’ve kept all of your receipts and invoices for any deductible items,” he said.

One area that caught out many workers last year was changes to remote work expenses that introduced record-keeping requirements for hours people working from home.

Under a fixed-rate method, the ATO requires real-time records of hours worked. But there are more ways to prove that than just with a diary that is updated daily.

“There’s various possibilities; if you complete timesheets, you can simply produce copies of them, or your employer can,” Chapman said.

“If you have a roster, a copy of the roster will do.”


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