Tax trick to boost your deductions by $300

Aussies can claim an immediate tax deduction on certain work-related items. (Source: Getty)

If you need equipment for your home office or a new briefcase for work, you might want to consider buying it before June 30.

The Australian Taxation Office (ATO) allows Aussies to claim an immediate deduction for certain work-related tools, equipment and assets if they cost $300 or less.

Here’s how it works.

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What can I claim?

As a general rule, Aussies can claim capital items costing them $300 or less in full as an immediate deduction.

This includes tools and equipment that you use for work, such as an office desk or chair, a briefcase, handbag or satchel, or office stationery.

The ATO says you’ll need to use the item more than 50 per cent of the time for a work purpose. So the ATO says you can’t claim a handbag if you mainly use it for private purposes, such as carrying your lunch or gym gear to the office.

What are the rules?

You’ll need to show the asset cost you $300 or less to get the full amount as an immediate deduction, the ATO says. If it was more than $300, you can only claim a deduction for the decline in the item’s value over its lifespan.

You’ll also need to show the item was used mainly for work and was used to generate non-business income. The ATO says this will include items like a briefcase, tools of the trade, or a computer or laptop.

If you mainly use the item for work, but you also use it for private purposes, you can only claim a deduction for the work portion.

So, if you bought a $200 printer and use it for work 60 per cent of the time, you can only claim $120 as a deduction.

You also can’t claim items that are part of a set costing more than $300, or items that are one of a number of identical or similar items that altogether cost more than $300.

You can read more about the rules on the ATO’s website.

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