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  • Fitness and sporting industry employees – income and work-related deductions

    If you earn your income as a fitness or sporting industry employee, this guide will help you work out what:

    • income and allowances to report
    • you can and can't claim as a work-related deduction
    • records you need to keep.

    Find out about fitness and sporting industry employees':

    Income – salary and allowances

    Include all income you receive during the income year in your tax return, this includes:

    Don't include reimbursements.

    Your income statement or payment summary will show all your salary, wages and allowances for the income year.

    Salary and wages

    You must include your salary and wages as income in your tax return. Include any bonuses.

    Allowances

    Include all allowances shown on your income statement or payment summary as income in your tax return.

    While all allowances you receive from your employer are income, you can't always claim a deduction if you receive an allowance – it depends on the situation.

    If you can claim a deduction, the amount of the deduction is not usually the same amount as the allowance you receive.

    Allowance types, reasons and deductibility

    Reason for allowance

    Example of allowance type

    Deduction (Yes or No)

    Compensation for an aspect of your work that is unpleasant, special or dangerous

    Supervisor allowance

    No

    These allowances don't help you pay for deductible work-related expenses

    Compensation for industry peculiarities

    Broken shift allowance

    No

    These allowances don't help you pay for deductible work-related expenses

    An amount for certain expenses

    Uniform allowance

    Yes

    If you incur deductible expenses

    An amount for special skills

    A first aid certificate

    Yes

    If you incur deductible expenses

     

    Example: allowance is assessable income, no deduction allowable

    Janelle is the manager of a fitness centre. Janelle's employer pays her a weekly supervisor allowance for performing the duties of a manager. The allowance is shown on her income statement at the end of the income year.

    Janelle must include the supervisor allowance as income in her tax return.

    Janelle can't claim a deduction because she doesn't incur any expenses. The allowance compensates her for the additional duties she takes on as the manager of the centre. It is not to help pay for work-related expenses that Janelle might incur.

    End of example

     

    Example: allowance is assessable income, deduction allowable

    Bronwyn works as a personal trainer at a gym. She generally meets clients at the gym for their sessions but she also meets them at or near where they live. During the income year, Bronwyn uses her own vehicle to travel:

    • from the gym to sessions with clients
    • from the gym to a training facility for skills training.

    Bronwyn's employer pays her 85 cents per kilometre when she uses her car for work purposes.

    At the end of the year, her income statement shows she was paid an allowance of $272 for using her car for work (320 kms × 85 cents).

    Bronwyn must include the car allowance as income in her tax return.

    Bronwyn can claim a deduction for the cost of using her car for work purposes. She can't claim the amount of the allowance she receives. Bronwyn must calculate the amount of the deduction using the records she keeps whenever she uses her own car for work purposes.

    In the past year Bronwyn has kept a record of the work trips she did using her own car, but she doesn't keep a logbook. Her records show she travels 320 kms for work purposes.

    As Bronwyn has not kept a logbook, she uses the cents per kilometre method to claim a deduction. The cents per kilometre method rate for the income year is 72 cents per kilometre. Bronwyn claims a deduction of $230.

    End of example

    Difference between allowances and reimbursements

    An allowance doesn't include a reimbursement.

    If your employer pays you:

    • an amount based on an estimate of what you might spend, such as paying cents per kilometre if you use your car for work, then it's an allowance
    • for the actual amount of the expense (either before or after you incur the expense), such as paying for the petrol you use if you use your car for work, it's a reimbursement.

    Allowances not shown on your income statement or payment summary

    Your employer may not include some allowances on your income statement or payment summary. This can apply to travel allowances and overtime meal allowances paid under an industrial law, award or agreement. You can see these allowances on your payslips.

    If the allowance is not on your income statement or payment summary, and you:

    • spent the whole amount on deductible expenses, you  
      • don't include it as income in your tax return
      • can't claim any deductions for these expenses
    • spent more than your allowance, you  
      • include the allowance as income in your tax return
      • can claim a deduction for your expense, if you are eligible.

    Reimbursements

    If your employer pays you the exact amount for expenses you incur (either before or after you incur them), the payment is a reimbursement. We don't consider a reimbursement to be an allowance.

    If your employer reimburses you for expenses you incur, you:

    • don't include the reimbursement as income in your tax return
    • can't claim a deduction for them.

    Find out about Fitness and sporting industry employees':

      Last modified: 16 May 2022QC 19680