Income Tax 2024

We have prepared this form to assist you in gathering the necessary information for your income tax return preparation and lodgement. Please complete as much of the form as possible. We will contact you if we need additional information or clarification.

We typically have access to employment and investment income already reported to the Australian Taxation Office (ATO) by payers. However, please provide any additional income information below that may not be automatically reported by selecting the options below.

You may provide details for any item in the boxes provided, or attach documents as required.

Note: It's important to declare all income sources to ensure an accurate tax return.

To claim a deduction for a work-related expense:

• You must have spent the money yourself and weren't reimbursed.

• The expense must directly relate to earning your income.

• You must have a record to prove it

Indicate which expense categories apply to you below.

You will have the opportunity to provide details, upload files, and read more about each expense claim when you tick a category.

These methods are used to calculate deductions for work-related car expenses.

Cents per Kilometre Method:

The cents per kilometre method is a simpler approach that allows you to claim a set rate for each kilometre driven for work-related purposes.

Key points:

• You can claim a maximum of 5,000 business kilometres per car, per year.

• You don't need written evidence, but you must be able to show how you calculated your work-related kilometres (e.g., using a diary of work-related trips).

• The rate is set by the ATO and is updated annually. For the 2023-2024 income year, the rate is 78 cents per kilometre.

• This method incorporates all car expenses, including depreciation, registration, insurance, maintenance, and fuel costs.

• You can claim for multiple cars using this method, but the 5,000 km limit applies to each car separately.

Advantages:

• Simple to calculate and doesn't require detailed records.

• Good for those who don't travel a lot for work or don't keep detailed logs.

Disadvantages:

• Limited to 5,000 km per car, which may not be sufficient for high-mileage work drivers.

• May result in a lower deduction compared to the logbook method for those who use their car extensively for work.

Logbook Method:

The logbook method provides a more accurate calculation of your car expenses but requires more detailed record-keeping.

Key points:

• You need to keep a logbook for a continuous period of at least 12 weeks.

• The logbook is valid for 5 years unless your circumstances change significantly.

You need to record:

• When the logbook period begins and ends

• The car's odometer readings at the start and end of the period

• Total kilometres travelled

• The number of kilometres travelled for work-related activities

• The purpose of each work-related trip

• You can claim the work-related percentage of each car expense, including fuel, servicing, insurance, and depreciation.

• You need to keep all receipts and invoices for your car expenses.

Calculation:

• Determine the work-related percentage of car use from your logbook.

• Apply this percentage to your total car expenses for the year.

Advantages:

• Often results in a higher deduction, especially for those who use their car extensively for work.

• No limit on the number of kilometres you can claim.

• More accurate reflection of your actual expenses.

Disadvantages:

• Requires more detailed record-keeping.

• More complex to calculate.

Choosing between methods:

If you travel a lot for work (more than 5,000 km per year) and are willing to keep detailed records, the logbook method may be more beneficial.

If you don't travel much for work or prefer a simpler method, the cents per kilometre method might be more suitable.

It's important to note that you can choose whichever method gives you the largest deduction, as long as you meet the criteria and have the necessary records. You can also use different methods for different cars and different years.

Brief list of claimable travel expenses:

• Transportation costs (flights, trains, taxis, etc.)

• Accommodation

• Meals

• Incidental expenses

• Parking fees

• Tolls

• Car hire fees

Now, let's focus on overnight travel for work and the evidence required, comparing situations where you're given an allowance versus no allowance.

Overnight Travel for Work:

What can be claimed:

• Accommodation: The cost of staying away from home overnight.

• Meals: Food and drink expenses incurred during the trip.

• Incidentals: Small expenses like phone calls, laundry, or internet access.

Evidence requirements:

When given an allowance:

• You must declare the allowance as income in your tax return.

• You can claim a deduction up to the reasonable amount set by the ATO without receipts. The reasonable amount varies based on your salary and destination.

• If you claim more than the reasonable amount, you must have written evidence for the entire amount, not just the excess.

• You should keep a travel diary for trips of 6 or more nights in a row.

When not given an allowance:

• You must have written evidence for all expenses you wish to claim, regardless of the amount.

• This includes receipts for accommodation, meals, and incidental expenses.

• You should keep a travel diary for trips of 6 or more nights in a row.

Travel diary:

A travel diary is required for trips of 6 or more nights in a row. It should include:

• The nature of the activity

• The day and approximate time the activity began

• How long the activity lasted

• Where the activity took place

Additional notes:

If your trip combines business and private activities, you can only claim the business portion.

You can't claim for normal trips between home and work, even if you live a long way from your workplace.

If you receive a travel allowance and spend less than the reasonable amount, you still need to show you incurred the expense if the ATO requests evidence.

Clothing deductions categories:

• Compulsory work uniforms

• Non-compulsory work uniforms

• Occupation-specific clothing

• Protective clothing

• Conventional clothing with protective features

• Laundry and dry-cleaning expenses for the above items

Detailed explanations:

Compulsory work uniforms:

These are distinctive clothing items you're required to wear by your employer. To be considered a uniform, it must be sufficiently distinctive to your organization. This typically includes:

• Clothing with your employer's logo

• Specific color schemes or styles that are strictly enforced

Non-compulsory work uniforms:

These are uniforms that aren't mandatory but are on a register kept by AusIndustry. To claim these, the uniform must be listed on the register for the entire period you're claiming.

Occupation-specific clothing:

This is clothing that is specific to your occupation and isn't suitable for everyday wear. Examples include:

• Chef's checked pants and white jacket

• Nurse's scrubs

• Judge's robes

Protective clothing:

This includes items that protect you from injury or illness at work, such as:

• Safety boots

• Fire-resistant clothing

• Non-slip nurse's shoes

• Sun-protective clothing for outdoor workers

Conventional clothing with protective features:

These are conventional clothing items with protective features that you wear at work, such as:

• Steel-capped boots

• Heavy-duty shirts and trousers

Important note: You cannot claim deductions for the cost of purchasing or cleaning conventional clothing worn at work, even if your employer requires you to wear it, and even if you only wear it to work. This includes:

• Suits

• Black pants and white shirts for hospitality workers

• General business attire

Laundry expenses:

You can claim a deduction for the costs of washing, drying, and ironing eligible work clothes, or having them dry-cleaned.

Laundry allowance:

If your laundry expenses are $150 or less, you can claim the amount you incur without providing written evidence of your laundry expenses.

However, you may still need to explain how you calculated your claim.

Calculation method:

The ATO allows you to use a reasonable basis to calculate your laundry expenses:

• $1 per load - if the load is made up only of work-related clothing

• 50 cents per load - if you include other laundry items in the load

For example, if you wash your work uniform twice a week in a load with other items, you could claim:

50 cents × 2 loads × 48 weeks = $48 for the year

Dry-cleaning expenses:

If you're claiming more than $150 for laundry and dry-cleaning expenses:

You need to keep all your receipts

You can't use the above rates – you must use the actual costs

Remember:

You can only claim the work-related portion of your laundry expenses.

If you receive an allowance from your employer for clothing, uniforms, laundry or dry-cleaning, you must declare this allowance as income in your tax return.

The $150 threshold is for laundry expenses only. If you're claiming laundering and dry-cleaning expenses, you need receipts for the dry-cleaning regardless of the total claim amount.

As always, it's important to keep records of your expenses and be able to explain how you calculated your deduction if asked by the ATO.

Here's an explanation of how self-education deductions work and what can be claimed:

Eligibility for Self-Education Deductions:

• To claim self-education expenses, the course you're undertaking must have a sufficient connection to your current employment and:

• Maintain or improve the specific skills or knowledge you require in your current work activities, or

• Result in, or is likely to result in, an increase in income from your current work activities

You cannot claim a deduction if the course is only remotely related to your current job or is designed to help you get a new job.

What Can Be Claimed:

• Course fees: Fees for courses at universities, TAFE colleges, other educational institutions, or from private providers.

• Textbooks: Books required for your course.

• Stationery: Items like pens, pencils, highlighters, notebooks specifically used for your study.

• Equipment: Depreciation on items costing more than $300 used for your study, such as computers or printers. Items costing $300 or less can be claimed in full immediately.

• Student union fees: Fees paid to student unions.

• Internet usage: The work-related portion of your home internet costs for online study.

• Phone calls: Calls made specifically related to your study.

Travel expenses:

• Travel between work and your place of education

• Travel from home to your place of education and back (only if you travel directly from home to your place of education and home again)

• Travel between your home and your place of education to another place of education and then home

• Accommodation and meals: Only if you're required to stay away from home for one or more nights for study purposes.

• Home office expenses: Costs related to using a dedicated study space at home.

• Student services and amenities fees: Fees charged by educational institutions.

Specific Exclusions:

You cannot claim:

• Repayments of Higher Education Loan Program (HELP) loans

• Student Financial Supplement Scheme (SFSS) repayments

• Home office occupancy expenses (like rent, mortgage interest, rates)

• Meals (except when sleeping away from home to attend a course)

$250 Reduction:

It's important to note that the first $250 of self-education expenses are not deductible. This is known as the $250 reduction. However, this reduction doesn't apply to:

Depreciation of equipment

Expenses for which you can't claim a deduction (which can be used to offset the $250 before it applies to deductible expenses)

Record Keeping:

You must keep records to support your claims, including:

• Receipts for expenses

• Invoices or statements from educational institutions

• A diary to record small expenses ($10 or less) totaling no more than $200

Calculation Methods:

For some expenses like home office use, you might need to apportion the costs between private use and study-related use. The ATO provides guidelines for these calculations.

Example:

If you have $1,500 in eligible self-education expenses:

Subtract the $250 reduction

Your deduction would be $1,250

Other work related expenses

Now, let's provide more detailed explanations for some items that require it:

1. Union fees and professional subscriptions: These are fully deductible if they relate to your current employment. Keep receipts or statements as evidence.

2. Work-related phone and internet usage: You can claim the work-related portion of these expenses. You'll need to keep a diary for a representative four-week period to determine the work-related percentage.

3. Home office expenses: You can claim electricity, decline in value of office equipment, and repairs for your home office space. The ATO provides several methods to calculate this: the shortcut method (for specific periods), the fixed rate method, or the actual cost method.

4. Overtime meal expenses: You can claim these if you receive an overtime meal allowance under an industrial law, award, or agreement, and you have spent the money on meals.

5. Tools and equipment: For items costing $300 or less, you can claim an immediate deduction. For items over $300, you must depreciate them over their effective life.

6. Protective items: This includes safety equipment like hard hats, safety glasses, and steel-capped boots. Sunscreen and sunglasses are claimable for those who work outdoors.

7. Vehicle expenses: These are claimable when you use your own car for work purposes (excluding normal commutes). You can use either the logbook method or the cents-per-kilometre method.

8. Travel expenses: You can claim accommodation, meals, and incidental expenses when traveling overnight for work. Keep all receipts and a travel diary for trips of 6 or more nights.

9. Professional insurance: This includes income protection insurance and professional indemnity insurance directly related to your job.

10. Ongoing education costs: These are deductible if they're directly related to your current employment and not reimbursed by your employer.

11. Conference attendance: You can claim registration fees, travel, accommodation, and meal expenses for work-related conferences.

12. Professional libraries: You can claim a deduction for the decline in value of a professional library that includes books, journals, and digital information.

Remember, for all deductions:

• You must have spent the money yourself and not been reimbursed

• The expense must directly relate to earning your income

• You must have a record to prove it

Working from home claim

1. Shortcut Method

This method was introduced in response to the COVID-19 pandemic and is available for specific periods.

How it works:

• Claim a rate of 80 cents per work hour for all your running expenses

• Available for the 2019–20, 2020–21, and 2021–22 income years (until 30 June 2022)

What it covers:

• Electricity and gas

• Internet and phone expenses

• Decline in value of equipment and furniture

• Cleaning expenses

Requirements:

• Keep a record of the number of hours you worked from home

• You don't need to have a dedicated work area

1. Fixed Rate Method

This is a more traditional method that has been available for many years.

How it works:

• Claim a rate of 52 cents per work hour for heating, cooling, lighting, and the decline in value of furniture

• Calculate and claim the work-related portion of your phone and internet expenses, computer consumables, stationery, and the decline in value of your computer, laptop, or similar device

Requirements:

• Keep a record of your work hours

• Have a dedicated work area in your home

• Calculate the work-related portion of your expenses

1. Actual Cost Method

This method involves calculating the actual costs of all your running expenses.

How it works:

• Calculate the work-related portion of all your running expenses

• This includes costs like electricity, gas, cleaning, phone, internet, decline in value of equipment, etc.

Requirements:

• Keep all your receipts

• Keep a diary for a representative four-week period to determine the work-related percentage of your expenses

• Have a dedicated work area

Comparison of Methods:

1. Ease of use:

• Shortcut Method: Easiest

• Fixed Rate Method: Moderate

• Actual Cost Method: Most complex

1. Record keeping:

• Shortcut Method: Minimal (just hours worked)

• Fixed Rate Method: Moderate (hours worked, plus some expenses)

• Actual Cost Method: Extensive (all expenses and usage diary)

1. Potential deduction:

• Shortcut Method: May be lower for those with high expenses

• Fixed Rate Method: Moderate

• Actual Cost Method: Potentially highest, but depends on actual expenses

1. Flexibility:

• Shortcut Method: Least flexible (covers all expenses)

• Fixed Rate Method: Moderately flexible

• Actual Cost Method: Most flexible (can claim actual costs for each expense)

1. Dedicated work area:

• Shortcut Method: Not required

• Fixed Rate Method: Required

• Actual Cost Method: Required

Choosing the best method:

• If you worked from home extensively and had high expenses, the Actual Cost Method might yield the highest deduction but requires the most effort.

• If you want simplicity and worked from home during the eligible periods, the Shortcut Method is easiest.

• The Fixed Rate Method is a good middle ground, especially if you have a dedicated work area but don't want to calculate all actual costs.

Remember, you can choose different methods for different income years, but you can only use one method for each income year. Always choose the method that gives you the largest deduction, provided you meet the criteria and have the necessary records.

There are a few expenses you can claim as a deduction even though they don't relate to your work.

These include:

• gifts and donations

• expenses related to earning income from investments

• personal super contributions

• income protection insurance

• the cost of managing your tax affairs.

Please contact the office if you need any further assistance.