Details on claiming common mining site employee expenses.
Tools and equipment
You can claim a deduction for tools and equipment you use to perform your duties as a mining site employee. For example, a drill or shovel.
You can only claim a deduction for the work-related use of the item.
If the tool or equipment cost you $300 or less, you can claim for full amount in the year you buy it, if:
- you use it mainly for work purposes
- it's not part of a set that together cost more than $300.
You can claim a deduction for the cost over the life of the item (that is, decline in value), if the tool or equipment:
- cost more than $300
- is part of a set that together cost more than $300.
If you bought the tool or item of equipment part way through the year, you can only claim a deduction for the decline in value for the period of the income year that you owned it. To work out your deduction use the Depreciation and capital allowances tool.
You can also claim a deduction for the cost of repairs to tools and equipment that you use for work purposes.
You can't claim a deduction for tools and equipment that your employer or a third party supplies for use.
Example: claiming a deduction for the decline in value for tools and equipment
Jorge buys a range of tools including a drill ($350), spanner set ($600) and welding equipment ($2,000) to carry out his employment duties.
He can't claim an immediate deduction for any tools and equipment because they cost more than $300.
Jorge must apportion the cost of these tools as he also uses them at home for DIY activities. Jorge applies a reasonable basis and determines that he uses the drill and spanner set 60% of the time for work purposes and the welding equipment 80%.
Jorge can claim a deduction for the decline in value over the effective life of the tools.
End of example
Example: Purchasing tools and equipment costing less than $300
Bob buys a hammer ($100) and a chisel ($250) for work purposes.
He is able to claim an immediate deduction for the full amount of the hammer and chisel as:
- he uses the tools and equipment mainly for work purposes
- the hammer and chisel are not part of a set that together cost more than $300.
Travel expenses
You can claim a deduction for travel expenses you incur when your work requires you to:
- travel for work
- sleep away from your home overnight in the course of performing your employment duties.
Expenses you can claim include your accommodation, meals and expenses which are incidental to the travel (incidentals).
You can't claim a deduction for travel expenses where you don't incur any expenses, because:
- you slept in accommodation your employer provides
- you eat meals your employer provides
- your employer or a third party reimburses you for any costs you incur.
You also can't claim a deduction if you are not required to sleep away from your home overnight in the course of performing your employment duties, for example if you fly interstate and return home the same day or if you are living at the location.
Receiving an allowance from your employer doesn't automatically mean you can claim a deduction. In all cases, you must be able to show:
- you were away overnight
- you have spent the money
- the travel directly relates to earning your employment income
- how you work out your claim.
If you receive a travel allowance you must include it as assessable income in your tax return unless all of the following apply:
- the travel allowance is not shown on your income statement or payment summary
- the travel allowance doesn't exceed the Commissioner's reasonable amount
- you spent the whole allowance on deductible accommodation, meal and incidental expenses (if applicable).
The Commissioner's reasonable amount is set each year. The amount is used to determine whether an exception from keeping written evidence applies for the following expenses which are covered by a travel allowance:
- accommodation
- meals
- incidentals.
You don’t have to keep written evidence such as receipts if both of the following apply:
- you received a travel allowance from your employer for the expenses, and
- your deduction is less than the Commissioner’s reasonable amount.
If you claim a deduction for more than the Commissioner’s reasonable amount you need to keep receipts for all expenses, not just for the amount over the Commissioner’s reasonable amount.
Even if you are not required to keep written evidence such as receipts, you must be able to explain your claim and show you spent the amounts. For example, show your work diary, that you received and correctly declared your travel allowance and bank statements.
Circumstances may be different for fly in, fly out (FIFO) workers.
Example: living away from home allowance
Joe is a project manager. He lives in the city with his family and applied for a job to work on a mining project near a country town for 12 months. He is paid a living-away-from-home allowance by the mining company to meet his accommodation and meal costs in the country town.
The allowance isn't income and shouldn't be shown on Joe's income statement. He can't claim a deduction for his accommodation and meal costs while living away for work.
End of example
Example: reasonable allowance amount
Antoni travels from Adelaide to Mt Gambier for a job. Antoni is away from home for 5 nights and his employer pays him a travel allowance of $110 per night for accommodation, meals and incidentals. The allowance isn't shown on his income statement.
The travel allowance amount paid to Antoni is less than the reasonable allowance amount and he spends all of the travel allowance on his travel expenses.
Antoni doesn't include his allowance on his tax return because:
- it isn't shown on his income statement
- it's less than the reasonable allowance amount
- he spends it all to cover his travel expenses.
This means Antoni can't claim a deduction for his expenses on his tax return.
End of exampleFor more information, see TD 2022/10 Income tax: what are the reasonable travel and overtime meal allowance expense amounts for the 2022-23 income year?
Union and professional association fees
You can claim a deduction for union and professional association fees you pay. You can use your income statement as evidence of the amount you pay if it's shown on there.
For more mining site employee expenses, see: