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  • Deductions

    You may be able to claim deductions for your work-related expenses. Work-related expenses are expenses you incur on items used to earn your income as an engineer.

    To claim a deduction for a work-related expense:

    • you must have spent the money yourself and weren't reimbursed
    • it must be directly related to earning your income
    • you must have a record to prove it (usually a receipt).

    If the expense was for both work and private purposes, you can only claim a deduction for the work-related portion.

    You can use the ATO app's myDeductions tool to help keep track of your work-related expenses. It’s an easy way to capture information on-the-go and makes tax time quicker by uploading your deductions to your tax return.

    For a detailed list to help you work out if your expense is deductible, and how much you can claim, see:

    Common expenses A–F

    Details on claiming common engineer expenses for:

    Award transport payments (fares allowance)

    If you receive an allowance from your employer for transport expenses or car expenses and it's paid to you under an award, it's assessable income and must be included on your tax return.

    You can claim a deduction for expenses covered by award transport payments only if the expenses are for deductible work-related travel.

    See also:

    Car expenses

    You can't claim a deduction for the normal trips between your home and work. These are private expenses even if you live a long way from your usual workplace or have to work outside normal business hours.

    The limited exception to this is if you must carry bulky tools or equipment between home and work. Then, you can claim a deduction only if:

    • your employer requires you to transport the tools or equipment for work, that is you don't carry them as a matter of personal choice or convenience
    • the tools or equipment are essential to earning your income
    • there's no secure area for storing them at your workplace
    • the equipment is bulky – meaning it's heavy and/or cumbersome.

    You can claim a deduction for the cost of using your car when you're travelling for work. For example, when you:

    • drive between separate jobs on the same day – for example, travelling to a separate job
    • drive to and from an alternate workplace for the same employer on the same day – for example, driving between work sites for the same employer.

    The Work-related car expenses calculator helps calculate the amount you can claim as a deduction for car expenses.

    You must keep records of your car use. If you drive a car you can choose between the cents per kilometre method or the logbook method to calculate your deduction. If you use the logbook method, you need to keep a logbook to help you determine the percentage of work-related use of your car. If you use the cents per kilometre method, you need to provide a calculation of your work-related kilometres. You must be able to show that the kilometres travelled were work-related.

    If you own a motorcycle, or a vehicle with a carrying capacity of one tonne or more, or nine passengers or more you can deduct your actual expenses.

    Example: no safe and secure storage

    Mike is a mechanical engineer who's responsible for constructing machines. He has to carry machinery and tools between his home and workplace each day to perform his duties.

    Mike's employer doesn't provide secure storage for him to store his tools and machinery at work, so he can claim a deduction for the expenses he incurs to transport his tools and machinery.

    End of example

     

    Example: from alternative workplace to home

    Richard works as a civil engineer for a large company in the city. He has to attend regular meetings at his employer's head office in the suburbs. He uses his own car to travel to the meetings. Richard goes directly home after the meetings because they finish late.

    Richard can claim the cost of travelling from his city office to the meeting at head office, and then to his home.

    End of example

     

    Example: between alternative workplace and work

    Jan makes site visits to view projects she's working on as a structural engineer. Sometimes, she travels from her home to view a site, and then continues on to her workplace.

    Jan can claim a deduction for her travel expenses from her home to the site and then onto her workplace.

    End of example

     

    Example: working partly from home

    Mohammed's employer has an office in the city, but is happy for Mohammed to work from home three days each week. On these days, Mohammed sometimes has to travel into the office for a meeting, before returning home to work.

    In this situation, the expense Mohammed incurs to travel between his home and work is a private expense that he can't claim.

    End of example

    See also:

    Child care

    You can't claim a deduction for child care that you pay for when you're working. It's a private expense.

    Clothing expenses (including footwear)

    You can claim a deduction for the cost you incur when you buy, hire, repair or replace clothing, uniforms and footwear you wear at work if it's:

    • protective
    • occupation specific (and not a conventional, everyday piece of clothing)
    • a uniform.

    To claim a deduction for the cost of a uniform it must be unique, distinctive and compulsory to wear. Clothing in a specific colour or brand isn't enough to classify clothing as a uniform. For example, a shirt with the corporate logo on it that you must wear when you work is a uniform, so you can get a deduction for buying it.

    You can't claim a deduction for the cost of buying or cleaning plain clothing worn at work, even if your employer tells you to wear it. You can't claim for:

    • heavy duty conventional clothing such as jeans, drill shirts and trousers
    • running shoes or casual shoes.

    These are private expenses.

    Example: conventional clothing

    Richard, an electrical engineer, works on a building site. He wears jeans with t-shirts or long sleeve shirts at work as they're comfortable. While the jeans and shirts afford Richard some protection from skin abrasions, they provide only limited protection from injury. The items are commonly worn as conventional clothing and aren't designed to protect the wearer or cope with rigorous working conditions.

    Richard can't claim a deduction for the cost of purchasing or cleaning these items because they're private in nature.

    End of example

     

    Example: protective clothing

    Rafael wears steel-capped boots and a hard hat when working at the industrial park. These items aren't of a private or domestic nature and are necessary for Rafael to wear while at work.

    The protective nature of these items means that Rafael can claim a deduction for their cost.

    End of example

    See also:

    Fines

    You can't claim a deduction for any fines you get when you work. Fines may include, parking fines and speeding fines.

    First aid courses

    You can claim a deduction for the cost of first aid training courses if you, as a designated first aid person, are required to undertake first aid training to assist in emergency work situations.

    For more engineer expenses, see:

      Last modified: 10 Apr 2019QC 22571