Loathing July 1st every year, when you’re a small business owner, isn’t as uncommon as
you might think. The receipts, the frantic EOFY purchasing and the uncertainty surrounding
what’s changed regarding what’s now claimable are more than enough to give anyone a
pounding noggin come tax time, but is it really that complicated?
Keeping up with the ATO’s deductibles annual updates can be a nightmare, and you always
end up discovering post-lodgement that there were another dozen things you could’ve
claimed!
We’ve managed to compile a list of deductions most business owners and employees forget
about by the time mid-year rolls around. Jot the following down nice and early so you can
start recording purchases now, allowing them to constantly remind you to set these aside for
the return season.
Laundry
Sport a uniform at work? It’s time to start claiming for those laundry-related expenses.
Recording how frequently you wash your work clothes will give you a more accurate idea of
how much to claim at tax time. You can claim up to $300 per year for laundry expenses,
using the ‘$1 per load’ rule of thumb as a general reference.
Remember to claim dry cleaning expenses for suits and other work attire too. It’s important
to remember that if you want to claim more than $300 for laundry you’ll have to prove why!
Entertainment
Did you know that pool table, retro gaming console or massage chairs for the office may also
be tax deductible? Well, save those proof of purchase docs just in case they are!
Many modern office spaces feature staff chill-out zones or entertainment-focused lunch
rooms to keep morale high and smiles on faces around the workplace.
Employee happiness is considered an investment so be sure not to overlook these
purchases as they’re usually significant and maybe even ongoing in terms of maintenance or
upkeep.
Donations
While our reason to be charitable should primarily be to do good in the world, there’s another
rewarding purpose associated with making donations throughout the year.
Yep, you guessed it. They’re also tax deductible!
All of those small $10 and $20 donations you make to charities and foundations add up over
the year, and if you’re making additional sizeable, recurring donations, then the tax break
really is worth the record-keeping efforts.
Sunscreen
This brings us to one of the most widely overlooked deductions of them all; sunscreen!
Many occupations require people to work outdoors exposed to extreme heat and UV
exposure year-round, yet most don’t even think to claim it. Slapping on a bit of sunscreen
every few hours, five days per week for the entire year starts costing you, but most won’t
contemplate how large of an expense it can be on a daily basis.
Sun protection products including creams, hats and sunglasses are all tax deductible.
But be careful, the ATO only allows those who must work outside to claim these purchases,
not if you’re conducting work duties outdoors by choice. Think landscaping, bricklaying and
other construction-type employment.
Dogs
While a fine line exists between what’s considered a pet and a working dog, some four-
legged friends can be both. For instance, you might now station your beloved Rottweiler at
your business complex, factory premises or construction site for security purposes, though
he or she once may have been a family home-based pet.
In many circumstances, guard dogs are considered an asset as they serve as protection for
expensive tools and other equipment.
Cattle dogs used on farms and for other agricultural purchases also fall within the realms of
claimable expenses.
Your pooch's upkeep including vet bills, food, feeding bowls, restraints, kennels and other
equipment are tax deductible if your dog is being utilised for business purposes.
It’s important to note that guard dogs are considered a specialised tax deduction category,
meaning their eligibility will ultimately be determined by the ATO.
Cleaners
Do you hire a cleaner to vacuum your office suites after hours? Have you purchased
industrial cleaning equipment to keep workspaces hygienic and safe for everyone?
Both of these expenses can be claimed on your tax return, and this also goes for those
working as cleaners who are required to purchase their own products.
Footwear & Accessories
Any shoes or work boots directly related to the workplace you’re working at are tax
deductible. However, many people believe buying a single pair of high-end ‘all-rounders’ for
the year and claiming them as work shoes is a smart move, but it’s actually not allowed by
the ATO. Any footwear claimed as a deduction must be solely worn for work purposes.
Handbags, backpacks and other accessories, on the other hand, are claimable now as long
as they’re used solely for work purposes like footwear. The ATO may also require
substantiation of their use as well.
Office Art
Thinking about sprucing up that empty wall space in the reception? Go for it! It’s tax-
deductible!
Add some much-needed life to your office spaces and claim it on your next return. The ATO
considers workplace artwork including some wall art, sculptures and monuments as forms of
employee entertainment, (just like the above games room situation), which in turn, remains
tax deductible.
Education
Trainees, apprentices and juniors in many fields usually combine studies with their
employment, sometimes enabling them to fast-track their careers and other opportunities.
Educational courses including TAFE and University studies are generally hefty and ongoing
expenses. If these are directly related to your employment, they’re tax deductible and should
never be overlooked by student employees.
So there you have it! A few more deductions to help you either reduce that tax bill or
increase your refund. Just be mindful not to go overboard in the deductions section as
nobody wants an unnecessary surprise audit to deal with.
Start saving those receipts (preferably digitally), and ensure you’re claiming absolutely
everything you’re entitled to for your business remembering that the difference can prove
astronomical!
Contact Ironbark Industries Bookkeeping today to discuss our bookkeeping services, your
specific requirements, or any other financial management enquiries.
