Can I deduct my dog? The 10 wildest tax questions we’ve heard

There is no such thing as a stupid question. But asking whether your chihuahua counts as a work-from-home security expense might test that theory.

This marks one of the more interesting questions asked of our AI-powered tax chatbot over the last year, and – to their credit – it does raise some oddly specific tax implications.

Unless your work involves something extremely perilous, it’s unlikely you’ll be able to claim the cost of your trusty hound.Credit: iStock

Accountants and financial planners are no stranger to confusing or confounding questions, but studies have indicated that people are more truthful with robots than people, leaving AI privy to queries many wouldn’t be brave enough to ask in person.

Below are 10 of the most … interesting of those questions, for your education and entertainment. And while our responses don’t constitute professional advice, they just might help you avoid an embarrassing conversation this tax season.

1. Can I claim my therapy bill if I talk about people I hate at work?

Therapy sessions that cover feelings about coworkers are generally considered personal expenses, which are not tax-deductible.

This is because deductible expenses must be incurred wholly, exclusively and necessarily in the performance of your employment duties. And, as it turns out, liking Janet from sales is not a job requirement. Damn.

2. If I sell a cow, do I need to charge GST? I’m not a farmer.

Why do you have a cow, Steve? That’s the important question. If you were a registered farmer selling to another farmer, GST would apply. But since you’re not registered as a business and this isn’t a commercial activity, GST doesn’t apply. So, your cow is a (quirky!) hobby, not a business transaction.

3. Can I claim driving lessons for a cleaner as an expense?

Is your house so big your cleaner needs a ride-on mop? If not, claiming driving lessons for your cleaner as a tax deduction is off the table – and your real estate dreams might need a rethink too.

4. Can I claim my dog as a security expense if it barks every time someone comes near the house when I’m working from home?

You haven’t said what breed your dog is, but I’m guessing it’s a chihuahua as they never stop barking.

So let’s be honest: unless your work-from-home setup involves a serious threat like terrorism, and your little woofing guard dog can actually stop it (unlikely!), this won’t fly as a deductible security expense.

5. Can dating sites count as networking expenses?

If you use a professional networking app like Bumble Bizz to grow your business, then sure. Those expenses could be deductible. But dating apps obviously don’t qualify – even if a date turns into a client.

6. How many Diet Cokes can an accountant drink per day?

Anyone asking a tax chatbot this question definitely needs to drink fewer Diet Cokes. But at tax season, an accountant could probably benefit from more caffeine.

Our chatbot may not be trained in dentistry, but I suspect an espresso followed by brushing your teeth would be better for your gum health.

Dating apps cannot be claimed as a business expense, even if your date ends up as a client.Credit: BusinessInsider

7. I own a proprietary limited company breeding horses. Are the horses classified as assets on my accounts?

In short, it depends. If you’re breeding stallions for business purposes, they’re generally classified as fixed assets and can be depreciated over their expected useful life, with capital allowances available as plant and machinery.

However, brood mares, foals, and young stock bred for resale are usually treated as “trading stock” and valued at the lower of cost or net realisable value. This one’s best discussed with an equine-specialist accountant.

8. If I win money at Two Up or at my mate’s games night, do I have to report it as gambling income? What if he only pays me in pizza?

Gambling income must be reported and taxed only if it is conducted as a business or professional activity. So if you are receiving your winnings in pizza, I suspect this is probably not the case for you. Casually playing Two Up at the local RSL also wouldn’t count.

But if you are the rare professional gambler who prefers non-cash pizza-related payments, enjoy the slice but don’t forget to declare the fair market value of the dough.

9. Do I need a minimum number of Instagram followers to write off my gym membership as a fitness influencer?

Australian taxation rules do not specify a minimum number of Instagram followers for deducting business expenses. But the membership does need to be a business necessity, i.e. “it should not serve significant personal enjoyment or use”.

10. If I bought a second monitor for work but only use it for Netflix, does the ATO know?

The ATO knows everything. Please do not try to trick the ATO. Whether intentional or not, misrepresentations can result in hefty fines, a criminal record, or even imprisonment for large-scale fraud or repeated offences.

Ryan Edwards-Pritchard is the CEO of ANNA Money in Australia, the business account that does your taxes.

• Advice given in this article is general in nature and is not intended to influence readers’ decisions about investing or financial products. They should always seek their own professional advice that takes into account their own personal circumstances before making any financial decisions.

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