The following outlines common types of deductible expenses claimed by individual taxpayers, such as employees and rental property owners, plus some strategies that can be adopted to increase deductions for the 2012/2013 income year.

Purchase or pay for work-related clothing expenses prior to the end of the income year, such as:

 Compulsory, non compulsory and registered, occupational specific and protective clothing;
 Other expenses associated with such work related clothing such as dry cleaning, laundry and repair expenses

Consider pre-paying the following self education items before the end of the year:

 €Course fees (but not HECS-HELP), student union fees, and tutorial fees.
 Interest on borrowings used to pay for any deductible self education expense

Also bring forward purchases of stationery and text books (i.e. those that are not required to be depreciated)

 Employees can prepay any of the following expenses prior to 1^st July 2013.
 Union fees
 Subscriptions to trade and professional or business associations;
 and newspaper subscriptions
 Seminars and conferences;
 Income protection insurance (excluding death, trauma and total/permanent disability).

We will need you to bring some information to assist us in preparing you income tax return. Please check the following and bring along payment summaries, statements, accounts, receipts, etc. To help us prepare the return.

 Payment summaries for salary and wages
 Lump sum and termination payments;
 Government pensions and allowances
 Other pensions and or annuities
 Allowances (e.g. entertainment, car, tools)
 Interest, rent and dividends
 Distributions from partnerships, trusts
 Details of any assets sold that were either used for income earning purposes or which may be caught by capital gains tax.

 Award transport claims
 Bridge/road tolls (travelling on business)
 Car parking
 Conventions, conferences and seminars
 Depreciation of library, tools, business equipment, incl. portion of home computer
 Gifts or donations
 Home office running expenses
 A log of hours spent working from home for work purposes
 Interest and dividends deductions
 Ongoing management fees
 Interest on borrowings to acquire shares
 Advice relating to changing investments (but not setting them up)
 Interest on loans to purchase equipment or income earning investments;
 Motor vehicle expenses (business) log book method required plus proof of ownership of the vehicle.
 Overtime meal allowances
 Rental property expenses – including:

 Advertising
 Council/water rates
 Insurance
 Land tax
 Interest
 Legal expenses/management fees
 Genuine repairs and maintenance
 Telephone expenses
 Travelling to inspect property

 Superannuation contributions by sole traders or substantially unsupported taxpayers
 Sun protection items
 Tax agent fees
 Telephone expenses (business)

 PAYG summary or Centrelink certificate for you and/or your partner
 Private health fund tax statement, whether you have claimed the rebate or not. Important: we cannot lodge your return without the statement
 Log books for your motor vehicle, telephones and home office hours
 Bank interest and dividend advice forms. Managed fund tax statements.
 Receipts for work related deductions including income protection insurance
 Rental property information (i.e. Receipts and mortgage statements)
 Rental property management statement or your own records
 Travel diaries

The Taxation Office will be conducting more work related audits this year and the following information will give you some idea of where that focus may be.

Once again they are putting added effort into reviewing claims for work related expenses made in returns that are lodged late.(more reason for you to be on time with your work)

They will also focus on the following :

Every worker in the building trade will be under scrutiny this year so please make sure you have receipts for all of your claims.

The other areas that will be closely reviewed will be home internet, mobile phones, motor vehicle expenses (don’t forget to keep log books) More scrutiny on self education  expenses especially where students commence work whilst doing their course.

Car expenses may be claimed using any one of the four methods below:

 Log book
 Cents-per-kilometre
 One-third actual expense
 12% original value

Log books are required for at least a 13 week period in the first year, and then every five years or every new car.
Log books are required for additional cars acquired for which the log book method is used.
Odometer records are required for the start and end of the period you owned or leased the car.
Written evidence of all other expenses is required. E.g. Receipts

 Remember that you must provide your car log book and documents proving your ownership of the vehicle with your 2012-2013 tax return if you use the log book method for calculating work related car expenses this year.

You are unable to claim for a vehicle you do not own

(if business use is 5,000km or less your claim is limited to 5,000km)

The claim is based on a set rate for each business kilometre.
Substantiation records are required.
The number of business kilometres is based on reasonable estimate, but a log book is preferred.

(Where business use exceeds 5,000km)

The claim for car expenses is based on 12% of the original value.
The value of the car is subject to luxury car limits.
Substantiation records are not required.
The number of business kilometres based on reasonable estimation, but a log book is preferred.

(Where business use exceeds 5,000km)

The claim for car expenses is based on one third of each car expense.
Logbook records are not required.
Fuel and oil expenses must be substantiated by written evidence or receipts as well as all other expenses.
Before you claim car expenses, you need to ensure that the travel you are claim is work-related travel and is deductible.

You cannot claim the cost of normal trips between home and work as it is private and not deductible even if:

You do small tasks while travelling to and from work such as collecting mail.
You travel outside normal employment hour such as shift work.
You are required to be on call.
You live a long distance from your work place, or there is no public transport.

You need to ensure that there is a sufficient connection between these expenses and your work activities at the time the expenses were incurred.
You cannot claim a deduction for self-education expenses if the study is:

 To enable you to get employment
 To obtain new employment or
 To open up a new income-earning activity

You can only claim a deduction for the decline in value of any assets costing more than $300 that you use in your work-related activities, however you can claim a 100% deduction for the cost of purchasing an item(s) which you acquire to use for your work-related activities, if the cost is $300 or less

You must apportion the amount of your claim where an asset has been used in part for private purposes or was not available for use during all of the financial year.

You must apportion expenses, such as mobile phone calls, home telephone calls and internet use between business and private use.

You need to keep either itemised accounts and/or a diary to support the basis of apportionment, you need to keep a record for representative period and a reasonable duration (generally four weeks) of the calls made and or time spent on the activity.

You can only claim occupancy expenses (such as interest on mortgage or rent paid) where your home office is considered a place of business. Refer to Taxation Ruling TR93/30-Deductions for home office expenses for further information about the limited circumstances in which you may claim for occupancy expenses and how to calculate you claim – more information at www.ato.gov.au

Remember if your property was purchased after September 1985, it may become subject to Capital Gains Tax when you sell it

If you are claiming minor use for your home office, you can calculate your claim by using a fixed rate of 34 cents per hour. You need to keep a record for a representative period and reasonable duration (generally four weeks) of the time spent in your home office on employment activities