Your Most common Tax Deductions…

With everyone now in the midst of compiling their information to complete their tax return or to give to their accountant/tax agent to complete, it is timely to be reminded of the common deductions available to most taxpayers.

1. Mobile Phones

Almost everyone now uses a mobile phone for work purposes. Either calling a colleague or clients for information regarding your work performed as a convenience to you or the other person. Well, if you do, then you are entitled to claim the costs of those calls as a deduction. Remember though, you can only claim the costs of the work related calls, not private calls.

Example: if your mobile phone plan is $60 per month and you estimate that 45% of use is for work purposes, you can then claim 45% of $60 = $27 x 12 for the year, which equals $324 deduction

      2. Cost of Managing Tax Affairs

You can claim a deduction for expenses you incur in managing your own tax affairs, including:

• preparing and lodging your tax return and activity statements
• travel, to the extent it is associated with obtaining tax advice – for example, the travel costs of attending a meeting with a recognised tax agent
• obtaining a valuation needed for a deductible gift or donation of property, or for a deduction for entering into a conservation covenant
• an interest charge the ATO impose on you for any outstanding tax payable

generally these expenses are claimed in the year you paid for them

     3. Home Office Expenses Claim

If you ever have to do some work at home ie checking emails and responding, you may be entitled to claim deductions for home expenses including a computer, phone or other electronic devices you are required to use for work purposes, as well as a deduction for running costs.

As an employee, generally you can’t claim a deduction for occupancy expenses, including rent, mortgage interest, council rates and house insurance premiums. however as a self employed or home based employee, occupancy costs maybe a tax deduction.

How to claim these expenses can become complicated so best to contact SMB Accounting (Contact) and we can increase your tax refund.

      4. Claiming Work Related Car Expenses

You maybe required to use your own vehicle for work reasons which would enable you to usually claim fuel, maintenance and registration costs. Only two methods for calculating your deduction are available, either logbook method or cents per kilometre method.

the logbook method you are required to keep a logbook for a 12 week period to calculate the claimable percentage of your costs. Work-related kilometres are those traveled in a car you own while you earn your income eg driving between jobs. Cents per kilometre is an allowance of 66cents per work related kilometres up to a maximum of 5000km can be claimed

Example: if you traveled in total for the year 1254km for work, your claim would be 1254 x 66cents = $828 tax deduction

Depending on your circumstances, either method may result in a larger claim, so if you are uncertain contact SMB Accounting on our Contact page and we can help you out with which method is best for you!

These and many more deductions may apply to your circumstances, Contact SMB Accounting now and let’s increase your tax refund