Yahoo Finance ATO reveals its hitlist
The Australian Tax Office is changing its tax-return monitoring this year by focusing on particular claim types instead of professions in their audits of people’s tax affairs.
This will put tech expenses for computers, phones and other devices, as well as travel expenses under the microscope.
In an announcement made today, the ATO says it will be keeping a close eye on the $19.5 billion in work-related expenses claimed each year as tax deductions.
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While the ATO has previously focused on particular industries that might be fudging their deductions, the taxman this year will crack down on the actual expenses that individuals are claiming against their taxable income.
The ATO’s priorities this year are:
• overnight travel,
• transporting bulky tools and equipment,
• the work-related proportion of use for computers, phones or other electronic devices.
The department has also highlighted some of the common mistakes people make on their tax returns.
They relate to making claims for home office, mobile phone and computer expenses without evidence supporting how the claims were divided between private work-related expenses.
This also includes incorrectly claiming travel between home and work as a work-related expense as well as claiming a travel allowance in full without spending it all.
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“If taxpayers are claiming work-related expense deductions, they must have spent the money, they must be related to their job and they must have a record to prove it,” says the ATO.
If you’re unsure about what you can claim, the ATO has several tax calculators for work-related expenses.
What can you claim
When completing your tax return, you're entitled to claim deductions for some expenses that are directly related to earning your income," the ATO website states. "The expense must not be a private, domestic or capital expense. If the expense was both work-related and private or domestic, you can only claim a deduction for the work-related portion."
