Tax time is here and whether you plan to use an professional to complete your return or do it yourself, it’s vital that you claim deductions for everything that you’re entitled to. Here’s a list provided by H&R Block Director of Tax Communication, Mark Chapman.
With the end of the financial year rapidly approaching, it won’t be long before its time to lodge your income tax return for 2024/25. To get the best possible tax outcome, it’s essential that you understand what you can – and what you can’t – claim against your taxes, so here’s a checklist of the deductions all workers in the travel industry should be considering claiming this tax year.
Remember, this list isn’t exhaustive and not all the deductions will apply to everyone. Similarly, you may be entitled to some deductions that aren’t listed here. Make sure you get professional help from a tax agent like H&R Block to ensure that you’re getting your return right
Travel and meals
You can claim the cost of travelling on your job – for instance, travelling between two offices or between the office and a client or customer. This includes public transport and taxi costs.
You can’t usually claim the cost of the daily commute to and from work.
If you plan to use your own car for work purposes, you can either claim a set rate of 88 cents per kilometre for all work journeys, or you can claim the actual expenses incurred. If you choose the latter, you’ll need to keep receipts for all costs (including road tolls and parking fees) and also keep a logbook of all your journeys for a 12-week period.
When it comes to claiming meals, you can only do so if the expense is incurred due to your being away for work. The same applies to accommodation and incidental expenses.
The cost of domestic and overseas travel where the purpose of the travel is for educational or research purposes can also be claimed, though there are several conditions that must be met.
Work-related clothing
You can claim a deduction for clothing that you’re required to wear as a uniform to work, provided the uniform has the company logo on it.
Instant asset write-off
If you own your own travel business (rather than being employed by somebody else), you can write off items of equipment costing up to $20,000 each immediately (rather than writing off the cost over the expected life of the asset) if the equipment was purchased in the current financial year and is installed and used, or available for use, by 30 June 2025.
You must be a small business in order to claim the instant asset write off (meaning you must have a turnover of less than $10m).
Amongst the items you can claim are the following:
- TV sets and other equipment to build ambience
- Furniture for break-out or rest areas
- Office furniture and equipment, like desks, chairs and cabinets
- Technology such as laptops, desktop computers, phones and tablets
- Motor vehicles (probably second hand, given the $20,000 threshold).
Work-related training
You can claim expenses for university or TAFE fees to the extent that the course relates to your current employment and you’re not being reimbursed (for example Cert III in Tourism (Retail Travel Sales)). Don’t forget to claim for the cost of books, stationery, equipment and travel required for your course
In addition, the cost of work-related short training courses is claimable, for example wholesaler training or industry promotions, AFTA courses, first aid, OH&S, customer service, computer skills or management.
Other deductions
They may not be as significant in dollar terms as some of the items listed above, but make sure you claim the following:
- Any work-related subscriptions or membership fees (including your subscription with any travel industry magazines)
- Magazines, journals, books, apps or websites which are related to your work
- The cost of using your personal mobile phone for work-related purposes
- Entry fees to tourist attractions where the purpose of your visit is for research to assist you to recommend the attraction to your customers
Working from home
If you operate a travel business from home, either occasionally or all the time, you are entitled to deductions for costs arising from working at home. The expenses that you can claim include:
- Heating, cooling and lighting
- Cleaning costs
- Decline in value (depreciation) of home office furniture and fittings, office equipment and computers (for items over $300)
- Computer consumables, stationery, telephone and internet costs
- Items of capital equipment (such as furniture, computers and associated hardware and software) which cost less than $300 can be written off in full immediately
With many retailers running End of Financial Year specials, any purchases you make now can be deducted in this year’s tax return so from a cash flow point of view, you can minimise the time between purchase and tax deduction!
Don’t forget if you are claiming the ATO’s 67 cents per hour fixed rate deduction for working for home, you must have a complete record of all your hours worked from home from 1 July 2024 (eg, a diary, timesheets or rosters).
If you run your own business from home, you can also claim occupancy expenses. These include the work-related portions of expenses such as mortgage interest (if you’re a home-owner) and rent (if you’re a tenant), as well as rates and home insurance. Remember, if you own your home and claim expenses such as these, you’ll lose the Capital Gain Tax main residence exemption on the same proportion of your home that you’ve claimed expenses for.
Remember to keep records!
Even if you’ve incurred any of the above expenses, the golden rule is that you can’t make a claim unless you can prove you spent the money (and that you weren’t reimbursed by your employer). So, make sure you keep all relevant receipts, invoices, bank statements and credit card statements. If you’re not sure if you can make a claim, keep the receipt anyway and discuss it with your tax agent.
Article supplied by H&R Block Director of Tax Communication, Mark Chapman.
