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  • Common expenses A–F

    Details on claiming common real estate employee expenses for:

    Advertising

    You can claim a deduction for the cost of advertising – for example, through newspapers, letterbox drops, signage and bunting.

    You can't claim a deduction for the cost of advertising if you earn your income from a fixed salary and you aren't entitled to earn commission.

    Car expenses

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

    In limited circumstances you can claim the cost of trips between home and work, such as where you carry bulky tools or equipment for work. You can claim a deduction for the cost of these trips if all of the following conditions are met:

    • The tools or equipment you carry are essential for the performance of your employment duties.
    • The tools or equipment are bulky, meaning that because of its size and weight it is awkward to transport and can only be transported conveniently by the use of a motor vehicle.
    • There is no secure area for storing such items at your workplace.

    It will not be sufficient if you transport the tools or equipment merely as a matter of choice. For example, if your employer provides reasonably secure storage, your decision to transport items home will be a matter of choice.

    You can claim a deduction for the cost of using a car you own, lease or hire (under a hire-purchase agreement) when you drive:

    • between separate jobs on the same day – for example, travelling from the real estate agency office to your second job as a waitperson.
    • to and from an alternate workplace for the same employer on the same day – for example, driving between separate real estate offices or residential open homes for the same employer.

    To claim a deduction you must keep records of your car use. You can choose between the logbook method or the cents per kilometre method to calculate your deduction.

    If you use the logbook method, you need to keep a valid logbook to help you determine the percentage of work-related use along with evidence of your car expenses.

    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.

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

    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 the actual expenses related to your work travel.

    Example: alternative workplace that isn't a regular workplace

    Trevor is a real estate agent who travels from his normal workplace to his employer's head office to attend a meeting. After the meeting he travels directly back to his normal workplace and then home.

    Trevor can claim the cost of each journey between his workplace and head office as a deduction as the trips are for work purposes and the head office isn't somewhere he works regularly.

    End of example

    Example: alternative workplace that isn't a regular workplace

    Patricia is a property manager who looks after a large number of properties. Two mornings a week Patricia travels from home directly to different clients' properties to carry out rental inspections. She then travels to her normal workplace.

    Patricia can claim a deduction for the travel between:

    • home and different clients' properties
    • one client's property and another
    • client properties and her normal workplace.
    End of example

    Example: bulky tools – not considered bulky equipment

    Dian is a real estate sales person who uses a laptop computer in the office and when she visits clients. She carries the computer to and from work in her car.

    As the computer isn't considered bulky equipment she can't claim a deduction for her travel costs to and from work based on transporting bulky tools and equipment.

    End of example

    See also:

    Car – leasing and hire-purchase payments

    The big difference between commercial leasing and hire-purchase is in the handling of tax deductions. With hire-purchase, instead of claiming the whole monthly payment as a tax deduction as you do with a lease, you claim the depreciation of the motor vehicle and any interest charged.

    Hire-purchase

    Under a commercial hire-purchase agreement you don't become owner of the motor vehicle until all monies owed under the arrangement are paid. However, you can still claim a tax deduction for the depreciation on the motor vehicle as well as the interest component of the loan repayments to the extent that the motor vehicle is used for work-related purposes. That is, interest on the loan payments and depreciation up to the car limit.

    Commercial leasing

    If you take out a car lease, the lender agrees to rent the vehicle to you for a set period for an agreed amount. If the vehicle is entirely for work purposes and not a luxury car, the lease payments are fully tax deductible but you can't claim depreciation.

    If the vehicle is a luxury car, you can claim a tax deduction for the finance component of the lease payments (interest) but not for the part of the lease payments that represent repayments of principal. You can also claim a deduction for depreciation subject to the car limit.

    If you lease a car under a salary sacrifice novated lease arrangement, you can't claim a deduction for the lease payments as these expenses are incurred by your employer. You also can't claim depreciation.

    Certificate of registration

    You can claim a deduction for the cost of renewing a real estate certificate of registration held by you as an employee in respect of your employment.

    You can't claim a deduction for the cost of getting the initial certificate of registration.

    Child care

    You can't claim a deduction for child care 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 clothing and footwear that provides a sufficient degree of protection against the risk of injury or illness posed by the activities you undertake to earn your income
    • occupation specific and not a conventional, everyday piece of clothing
    • a compulsory uniform that identifies you as an employee of an organisation with a strictly enforced policy that makes it compulsory for you to wear the uniform while you're at work
    • a non-compulsory uniform, if your employer has registered the design with AusIndustry.

    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 your employer strictly requires you to wear when you work is a compulsory uniform, so you can claim a deduction for buying and repairing it.

    You can't claim a deduction for the cost of buying plain clothing such as black trousers, plain shirts or black shoes worn at work, even if

    • you only wear them to work
    • your employer tells you to wear them.

    These are private expenses.

    You can’t claim a deduction if your employer buys or mends your clothing and footwear.

    Example: compulsory uniform with logo

    Farhad has to wear shirts his employer provides. Each shirt has his employer's company logo embroidered on it. As part of his uniform, he also has to wear black pants and black shoes.

    Farhad can claim a deduction for the cost of laundering the shirts as they are:

    • distinctive items with the employer's logo
    • compulsory for him to wear at work.

    However, he can't claim the cost of buying or cleaning his black pants or shoes as they're items of a conventional nature.

    End of example

    Example: registered with AusIndustry

    Lena is a sales person with a large real estate company. She also works in the reception area for a number of hours each day. Reception staff wear a suit in the company's colours monogrammed with the company logo. It isn't compulsory for a staff member to wear the clothing, but the employer encourages staff members to do so.

    Lena can claim a deduction for the cost of buying and maintaining the suit if the uniform is entered on the Register of approved occupational clothing. It's the employer who seeks registration for the clothing with AusIndustry.

    End of example

    Example: you can’t claim a deduction for the purchase of conventional clothing

    James is employed as a property manager. He is required to comply with dress standards and wear office attire while at work. James purchases a number of collared shirts and long pants from a department store. James can't claim the cost to buy or launder these items as they are considered conventional clothing and private in nature.

    End of example

    See also:

    Decorating properties

    You can claim a deduction for the cost of decorating items used at properties, such as flowers, if you're entitled to earn a commission from the sale of the property.

    Driver's licence

    You can't claim a deduction for obtaining or renewing your driver's licence, even if you must have it as a condition of employment. This is a private expense.

    Entertainment and social functions

    You can't claim a deduction for the cost of any entertainment and social functions. This includes the cost of business lunches and attendance at sporting events, gala or social nights, concerts or other similar types of functions or events. This applies even if you discuss business matters at the occasion.

    The 'provision of entertainment' generally means:

    • entertainment by way of food, drink, recreation
    • accommodation or travel to do with providing entertainment by way of food, drink or recreation.

    Example: entertainment costs

    Rachael attends a social breakfast organised by the Real Estate Institute. These breakfasts are held every other month to encourage new salespeople in the real estate industry to meet socially with colleagues.

    Rachael can't claim a deduction for the cost of attending the breakfast.

    End of example

    For more real estate employee expenses, see:

      Last modified: 04 May 2020QC 24417