We can help you work out whether you are entitled to a deduction for such expenses and the necessary record keeping requirements – please let us know when you come in to see us.

Here are some examples of relevant cases that have been provided by the ATO:

Car expenses: Transporting bulky tools

A car mechanic claimed $3,850 in car expenses for carrying his large toolbox to and from work each day. The employer told the ATO that they supply all of the necessary tools at the workshop for the mechanic to do his job but he preferred to use his own tools.

The car expenses were disallowed because the mechanic chose to use his own tools, rather than the tools provided by the employer. Travel from home to work is private and not tax deductible. The mechanic was required to pay over $2,000 in tax and penalties.

Travel expenses

For each day a boilermaker worked away from home, he received a travel allowance from his employer. The boilermaker’s payment summary showed he was paid a travel allowance of $8,000 during the year, the same amount that the boilermaker claimed as a deduction.

The employer paid the travel costs to get the boilermaker to and from work and provided accommodation and all meals. The claim for travel expenses was disallowed because the boilermaker did not spend any money. As the travel allowance was shown on the boilermaker’s payment summary, it needed to be included as income on the tax return. After penalties were applied, the boilermaker received a bill for almost $4,000.

Car and uniform expenses

A real estate agent claimed work-related motor vehicle, work-related clothing, laundry and dry-cleaning expenses. During the audit process she provided allegedly false tax invoices from a commercial car wash and dry cleaner to support her claims. The real estate agent was prosecuted, pleaded guilty and fined $4,000.

Mobile phone expenses

A labourer claimed $1,200 in other work-related expenses for use of her mobile phone. The labourer told the ATO she used her phone at work to keep in touch with co-workers but did not have records to show this usage.

When the ATO spoke to the labourer’s employer, it was told the labourer was not required to use their mobile as part of their duties. However the ATO accepted that the labourer may have occasionally used her mobile phone for work purposes and allowed a claim of $50 for the year.

Self-education expenses

A retail sales assistant claimed a deduction for self-education expenses of $5,165 for course fees relating to a bachelor of arts degree. As the degree did not directly relate to the assistant’s current job, and there was no requirement to undertake further education, the claim was disallowed.