Expert's 9 commonly overlooked tax deductions that will maximise your return

Many people don’t claim everything they are entitled to because it might seem too hard to calculate, expenses are forgotten about, or it feels like a lot of hassle for just a few dollars. 

Ah, tax season. 

The time of year that simultaneously strikes fear into the hearts of many and ignites a flicker of hope in others!

Will we get a juicy return this year and have some extra cash for European summer (or the Big W toy sale, let's be honest)?

Only time will tell!

But according to financial advisor Helen Baker, author of On Your Own Two Feet, The Essential Guide to Financial Independence for all Women, there are a few overlooked (but totally legit) deductions you could be claiming to give you the best chance of getting a nice little deposit into your bank account. 

Speaking to Kidspot, Baker says that many people don’t claim everything they are entitled to because it might seem too hard to calculate, expenses are forgotten about, or it feels like a lot of hassle for just a few dollars.

But, they're well worth it apparently - so let's get into Baker's tips.

Image: IStock

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The 9 often-overlooked tax deductions 

Work-from-home expenses

It’s easy to forget about legitimate expenses incurred while working from home. This includes electricity and gas, internet, phone, printing paper and toner ink, stationery, home office furniture etc.

It’s also important to note that rate calculations have changed this year. The 80 cents per hour shortcut method of the COVID years is no more. The fixed work-from-home rate has increased to 67 cents per hour (up from 52 cents).

Depreciation

The decrease in value that comes from general use of everything from cars to computers, phones to office furniture, can be claimed as a tax deduction. If you own a business, much of the fit-out (like air-conditioning, carpets and equipment) can also be depreciated.

Mileage

With public transport usage still down on pre-pandemic levels, many people will likely claim some form of mileage for work-related trips.

The ATO wants records, like a logbook, to prove your travel, but that works for your benefit too – you won’t overlook claiming mileage for that quick dash to the post office or a customer site visit. Remember to claim any relevant tolls too.

Industry-specific deductions

Do you work outdoors? Then you may be able to claim sun protection and sunglasses. Are you required to wear a specialist uniform and/or safety gear?

The costs of both purchasing and cleaning them may be deductible. Check out the occupation and industry-specific deductions guide for your occupation to see what you can legitimately claim.

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Self-education

There’s now even more reason to claim self-education expenses – the $250 non-declarable threshold has been scrapped! Previously your first $250 was not deductible, but that has been removed starting this financial year.

Interest repayments

For anyone with an investment-related loan, such as a mortgage for a rental property, those interest repayments are tax deductible. So higher interest rates mean bigger deductions.

Be careful claiming this on your home mortgage if you work from home, however, as you could make the property liable for Capital Gains Tax once you sell it.

Superannuation contributions

When it comes to superannuation, you can claim a tax deduction for paying yourself additional super or contributing extra to your spouse’s super. It’s a win-win as you enjoy the deduction now AND grow your retirement fund.

Plus, low income-earners may be eligible for up to $500 in co-contributions from the government – giving you extra bang for your buck!

Financial advice

Most people know that the costs of doing your tax return are deductible, including accountant fees. But less well-known is that ongoing financial advice fees are also deductible.

There is growing pressure on the government to extend this to include up-front financial advice expenses too, to help make this advice accessible to more Australians.

Record-keeping

With tax office demanding more records to prove your claims, such as vehicle logbooks for work-related travel and diaries of hours worked from home, the cost of those records is also deductible.

Whether you use paper diaries or digital apps is up to you (the latter having the benefit of being electronic and harder to lose).  Don’t forget your donations.

Originally published as Expert's 9 commonly overlooked tax deductions that will maximise your return