Tax Return Tips – Tax Deduction Claim
It is that time of the year again where we need to gather our tax related information for our tax returns.
The ATO will be looking closely at all work related deductions again this year to make sure that deductions are being claimed correctly.
For the 2018 financial year the ATO started to advise taxpayers if their work related deductions were high in comparison to other individuals working within the same industry. This was advised on their ATO pre fill report. Recent media releases from the ATO indicate that the claims of all taxpayers are now under the microscope.
There are 3 golden rules in claiming a tax deduction:
1. You must have paid something for your work and have not been reimbursed.
2. The expense must be directly related to your work and not a private expense.
3. You must have a record to prove your claim by either receipts/supporting documents, diary of your work related activity kept over 4 weeks period or a valid log book. Even if the ATO advises that you can make a claim without receipts under a certain amount, you will still need to be able to justify your claim by showing them how you have calculated your claim. The ATO is able to question any item and without the required proof or ‘substantiation’, they can levy penalties and interest.
CrossCorp has written many Tax Tips over time in relation to work related deductions. You can search for Work Related Deductions articles from our blog section.
To make sure that you will be claiming the correct deduction for 2019 financial year, contact our office and speak to one of our Advisors!
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