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Work-related expenses on the radar

Local accounting firm BMO is warning people who are trying to claim car and travel expenses to make sure they are sticking to the rules and don’t try to double dip or they could risk facing the scrutiny of the Tax Office.

BMO Assistant Accountant Ashleigh Peltz said that the Australian Taxation Office (ATO) has advised it will be looking especially close at work-related expenses in 2014/15 income tax returns.

“The ATO are cracking down on those putting in any unusually high work-related expense claims across all industries and occupations and in particular, claims which have already been reimbursed by employers for private expenses and travel claims.

If you’ve already been reimbursed by your employer for an expense, you can’t also claim that expense as a tax deduction. That would be considered double dipping.

She said it was also important to be aware of the rules around travelling from home to work.

“Travelling from home and work is not able to be claimed unless your situation meets specific ATO requirements.

“If your car is used to carry bulky tools or equipment for work and you can’t leave these items on the work premises, or if your home is a base for employment and you regularly work at more than one place each day, then you may claim a deduction, but we strongly suggest you seek advice for your individual situation,” Ms Peltz said.

Ms Peltz said that wage earners need to be cautious when claiming these deductions.

“As a general rule to make a genuine claim taxpayers must have spent the money, it must be related to their job and they must have a record to prove their claim,” Ms Peltz said.

Ms Peltz also stated that the best way to find out what deductions you can claim that are related to your occupation, is to have your tax return completed by a registered tax agent.

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