Top 5 Overlooked Tax Deductions

With the end of the financial year fast approaching, it’s a good time to discuss tax deductions – especially those deductions often missed by taxpayers like you. We have compiled the commonly forgotten tax deductions.

Take a look below – do any of these deductions apply to you? Are you keeping proper records to make sure you get the best possible tax refund?

Union/Membership fees

Are you part of a union? How about a membership body related to your profession? If you pay work-related union or membership fees you can claim the total cost of these fees.

Cost of managing your tax affairs

Did you use a tax agent to prepare and lodge your tax return last year? If you did, then you can claim the amount you paid last year – on this year’s return. On your tax return, simply put the amount you paid in 2016 into section D10 – “Cost of Managing Tax Affairs”. The fees you pay for tax return help are always tax deductible.

Home office expenses

Do you ever find yourself working from home? How about checking and responding to your work emails in the evening or on the weekend? If you do, then you may be able to claim the cost of using your personal computer as a tax deduction.  The ATO allows employees who work from home occasionally to claim part of their home office expenses.

Work related Car Expenses

People who use their personal car for work-related reasons, apart from driving to and from work, can usually claim fuel and maintenance costs as a tax deduction. As of 2016, these claiming methods have changed – you can either use a 12 week logbook (which generates numbers you can re-use for 5 years!) or the cents per kilometre method.

The ATO defines work-related kilometres as kilometres travelled in your car while you are earning your income. To be eligible, you must be the owner of the car and your travel must be part of your working day – e.g driving between offices, special trips to the post office or bank (not including stop-offs on the way home) or moving from one job site to another. Remember, you cannot claim trips between work and home unless you’re carrying heavy equipment for work, or transporting heavy tools required to do your job.

Depending on your personal circumstances, either a logbook or the cents per kilometre may be a better method for you. If you’re unsure which to use, please contact your Nobel Thomas Melbourne accountant and one of our accountants will help choose which method gets you the biggest tax deduction.

Internet Expenses

If you ever work from home and you have your internet connection in your name, then it’s likely you could claim your Internet expenses as a deduction. How? Simply estimate your monthly work use as a percentage of the total household use.

Please note: If you share the cost of internet with a spouse, partner or housemate, you should only calculate the percentage of total internet cost that applies to you. For example if you live with your partner it would be assumed, you each pay half of the bill. Therefore in the example above, Sally would only use 50% of the total Internet cost ($30 per month) in her expenses calculation as her partner would use the other 50% on their tax return.

If you have questions or you require assistance in filing your taxes, please don’t hesitate to contact Melbourne Accountant today.



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