Things you need to know
You may be able to claim a deduction for expenses that you haven't been able to claim elsewhere in your tax return.
If you don't have any other expenses that you haven't been able to claim as a deduction at questions D1 to D14 or elsewhere in your tax return, go to Total supplement deductions 2025.
You may claim at this question:
- election expenses for local, territory, state or federal candidates
- income protection, sickness and accident insurance premiums
- foreign exchange losses
- expenses relating to income you earn from the sharing economy or other marketplace which you don't derive from carrying on a business or as an employee of the digital platform
- debt deductions you incur in earning assessable income that aren't disallowed under the thin capitalisation rules and didn't claim them elsewhere
- debt deductions you incur in earning certain foreign non-assessable non-exempt income that aren't disallowed under the thin capitalisation rules
- amounts deductible for certain business-related capital expenditure under section 40-880 of the Income Tax Assessment Act 1997 (ITAA 1997), either
- over 5 income years relating to a business you carry on through a company or a trust
- immediately as start-up expenses relating to the structure or the operation of the business that you propose to carry on
- a deduction for the net personal services income (PSI) loss of a personal services entity that relates to your PSI
- certain deductible capital expenditure you didn't claim in full before ceasing a primary production business where a deduction can be claimed in a subsequent year or years
- non-capital losses you incur on the disposal or redemption of a traditional security that are deductible under section 70B of the Income Tax Assessment Act 1936 (ITAA 1936) – for more information, see Sale or disposal of company bonds and convertible notes in You and your shares 2025
- small business pool deductions for depreciating assets of your small business pool that you can't claim in the Business and professional items schedule 2025 at P8 Business income and expenses because you don't carry on a business in 2024–25 (for more information, see Small business pool).
- self-education expenses you incur in doing a course to satisfy the study requirements of a taxable scholarship.
You can't claim deductions for expenses you incur in actively seeking paid work if you receive Youth Allowance or JobSeeker payment as a job seeker.
Election expenses
Election expenses include a candidate's costs of contesting an election at a local, territory, state or federal level of government. A deduction for local government election expenses can't exceed $1,000 for each election you contest, even if you incur the expenditure in more than one income year. Entertainment expenses qualify as deductible election expenses only in very restricted circumstances.
For more information on deductions for election expenses, see Taxation Ruling TR 1999/10 Income tax and fringe benefits tax: Members of Parliament – allowances, reimbursements, donations and gifts, benefits, deductions and recoupments.
You must show as income at question 24 in your supplementary tax return a reimbursement in 2024–25 of any election expenses that you claim as a deduction in 2024–25 or a previous year.
Income protection, sickness and accident insurance premiums
You can claim the cost of any premiums you pay for insurance against the loss of your income. You must include any payment you receive under the policy for loss of your income at questions 1, 2 or 24 in your tax return.
You can't claim a deduction for a premium or any part of a premium which you pay under a policy to compensate you for such things as physical injury. Life insurance, trauma insurance and critical care insurance are some types of policies for which premiums aren't deductible.
You can't claim a deduction for a premium where you take the policy out through your super fund and they deduct the premiums from your super contributions.
Foreign exchange losses
Unless you carry on a business and include all your foreign exchange losses (forex losses) in calculating your business net income or loss at question 15, you must show your deductible forex losses at this question (except any foreign source forex losses that you include at question 20). Show any assessable foreign exchange gains (forex gains) at question 24 in your supplementary tax return.
Losses attributable to a fluctuation in a currency exchange rate or to an agreed exchange rate differing from an actual exchange rate are brought to account when they are realised. Losses include when you:
- dispose of either foreign currency, or a right to such currency
- cease to have a right to receive or pay foreign currency
- cease to have an obligation to pay or receive foreign currency.
Some forex losses aren't deductible – for example, forex losses of a private or domestic nature, or those relating to exempt income. In some cases, forex losses on the acquisition of capital or depreciating assets, or on the disposal of capital assets, are also not deductible. In these cases, the losses are integrated into or matched with the tax treatment of the underlying asset.
In some circumstances, you may make an election that affects the realisation or treatment of a forex loss. For more information on the forex measures and how to calculate your forex losses, see Foreign exchange gains and losses.
Expenses relating sharing economy or other marketplaces income
The sharing economy is economic activity through a digital platform (such as a website or an app) where people share assets or services for a fee. Amounts you receive are assessable income, even if you aren't carrying on a business.
Include at this question expenses you incur that relate to income you receive from renting or hiring (sharing) out your assets through a digital platform.
If you own or lease an asset jointly, then you claim your deduction in proportion to your share of ownership.
Car expenses have special deduction rules, which don't apply to other vehicles such as trucks, motorbikes, bicycles, or self-drive recreational vehicles (RVs).
Caravan or RV expenses have special rules for calculating apportionment for income-producing and private use.
Also include at this question expenses you incur that relate to income you receive from providing services or completing tasks through a digital platform, except income you earn as an employee of a digital platform.
Don't show expenses at this question that relate to:
Income you earn through sharing economy or market place activities where you're carrying on a business; show this amount at P8 Business income and expenses in the Business and professional items schedule 2025.
- Rental income, such as renting all or part of your home; show this amount at question 21 in your supplementary tax return.
- Employee salary or wages; show this amount at the relevant deduction question D1–D5 in your tax return.
You must apportion your expenses for private use. You can only claim deductions for your expenses to the extent that they relate to your income-producing activities. You may be able to claim fees or commissions a digital platform charges you as a 100% deduction.
Peer-to-peer car sharing – car expenses
If you share your car through a digital platform, you can deduct car expenses that directly relate to the income you receive for sharing out your car. These rules don't apply to other vehicles such as trucks, motorbikes, bicycles or self-drive recreational vehicles.
Car expenses include decline in value, interest, leasing payments, insurance and registration. They can also include service, repair, cleaning and fuel expenses if you incur those expenses under your car sharing agreement. Different agreements require either the car borrower or the car owner to bear the costs of refuelling the car. You're entitled to claim expenses only to the extent that you incur them.
In most cases, you will also use your car for private use. You can only claim deductions for your car expenses to the extent that they relate to your income-producing activities. This means you need to apportion any car expenses between private use and income-producing use.
If you own the car as an individual (or as partner in a partnership that has an individual partner), there are 2 methods of claiming car expenses:
Peer-to-peer caravan sharing – apportioning expenses
If you share your caravan or RV and there is also private use during the year, you must apportion your expenses to account for the private use. You can only claim deductions for your expenses to the extent that they relate to your income-producing activities.
Private use includes any use by you, your family, relatives or friends which is free of charge or for a small fee to cover running costs. If you rent or hire out your caravan or RV to family, relatives or friends at below market rates, your deductions are limited up to the amount of the income you receive.
If you purchase or use your caravan or RV mainly for:
- private use – you can only claim deductions that relate to the periods when you actually rent out the caravan or RV, any other time is private use, even if it's available for rent on the platform
- income-producing use – you're entitled to claim deductions for periods when you rent out, or genuinely make available for rent the caravan or RV.
There are multiple factors you need to consider in determining whether your caravan or RV was genuinely available for rent.
Debt deductions
You may claim 'debt deductions' you incur in earning assessable income (for example, foreign source income that you include at question 20 in your supplementary tax return) at this question, if you didn't claim them elsewhere in your tax return.
A 'debt deduction' is, broadly, an expense you incur in obtaining or maintaining a loan or other form of debt finance. Examples include:
- interest
- establishment fees
- legal costs for preparing loan documents
- fees lending institutions charge for drawing on a loan facility.
If you're an Australian resident, you can claim debt deductions you incur in earning certain types of foreign non-assessable non-exempt income that are payments out of attributed controlled foreign company income or attributed foreign investment fund income.
You aren't allowed to claim debt deductions disallowed under the thin capitalisation rules. Thin capitalisation rules may apply if you're either:
- an Australian resident and you (or any associate entities) have certain overseas interests and your debt deductions combined with those of your associate entities is more than $2 million for 2024–25
- a foreign resident with operations or investments in Australia and your debt deductions against Australian assessable income combined with those of your associate entities is more than $2 million for 2024–25.
Special rules apply to deductions for expenses that you incur in borrowing money that you use for producing assessable income. Examples of such expenses include loan establishment fees and legal costs for preparing loan documents. Interest expenses aren't subject to these rules and are deductible in the income year in which you incur them.
If the total borrowing expenses (except interest expenses) you incur in 2024–25 are more than $100, you have to deduct the expenses over the shorter of either:
- the life of the loan
- 5 years from the date you first borrow the money.
If the total of these expenses you incur in 2024–25 is $100 or less, you can deduct them immediately.
Section 40-880 deductions
This section allows you to claim a deduction for certain business-related capital expenditure over 5 income years or immediately in case of some start-up expenses.
Expenditure deductible over 5 income years
Claim a section 40-880 deduction at this question if either:
- you incur the relevant capital expense, and the following apply
- the expenditure relates to a business that is proposed at the time you incur the expense
- the business commences by 30 June 2025
- you're carrying on the business through a company or trust
- you incur the relevant capital expense and the expenditure relates to a business which ceased in a previous income year and you carried on the business through a company or trust.
If you incur relevant section 40-880 expenses, claim the amount in the Business and professional items schedule 2025 at P8 Business income and expenses if the expenses are in relation to both:
- a business which ceases in a previous income year
- you carried on the business as a sole trader or through a partnership.
If this applies to you, then you should lodge your tax return using myTax or a registered tax agent.
If you're unable to use myTax or a registered tax agent, contact us and we'll send you a paper tax return that includes the Business and professional items schedule 2025.
Certain start-up expenses
Section 40-880 of the ITAA 1997 allows a taxpayer who isn't in business, or who is a small business entity, to immediately deduct certain start-up expenses relating to the structure or operation of a business that you propose to carry on.
This was extended to medium businesses for expenses incurred from 1 July 2020.
Expenditure is fully deductible in the income year in which you incur it, if:
- you're a small or medium business entity, or you aren't in business during the income year, and
- it relates to a business that you propose to carry on, and
- either
- you incur the expenses for advice or services relating to the structure or operation of the business
- pay an Australian government agency in relation to setting up the business or establishing its operating structure.
If you incur relevant section 40-880 expenses that don't qualify for immediate deduction and you haven't commenced the business by 30 June 2025, defer your deduction for this amount until the income year in which the business activity commences.
For more information on section 40-880 deductions, see Guide to depreciating assets 2025.
Net PSI loss of a personal services entity that relates to your PSI
There are special rules for the income tax treatment of certain PSI. PSI is income that is mainly a reward for your personal efforts or skills and is generally you or a personal services entity (being a company, partnership or trust) receive the payment.
Where the payment is made to a personal services entity and that entity incurs a PSI loss relating to your PSI, you can claim a deduction for that loss.
For more information on PSI deductions, see Claiming deductions when receiving PSI.
If you need help with these rules, Seek further advice about PSI.
Self-education expenses for study requirements of a taxable scholarship
You may claim at this question expenses you incur in meeting the study requirements of a taxable scholarship. However don't claim these expenses at this question if you're an employee of the provider; claim them at question D4 Work-related self-education expenses 2025.
Examples of expenses you can claim are textbooks, stationery, student union fees, student services and amenities fees, the decline in value of your computer and certain course fees.
You can't claim a deduction for travel from your home to your normal place of education and back.
Use our Self-education expenses calculator to help you work out your deduction.
Don't include at this question
Don't show at this question:
- expenses relating to your work as an employee
- expenses relating to income from carrying on a business as a sole trader (including PSI or as a share trader)
- expenses relating to investment planning and advice involving shares, unit trusts and interest-bearing deposits
- losses from the disposal of shares or real property that are capital in nature.
Other questions deal with these matters.
Completing your supplementary tax return
To complete this question, follow the steps.
Step 1: Election expenses
Add up all your deductible election expenses. Write the total amount at question D15 – label E in your supplementary tax return. Don't show cents. If you have no other expenses, go to Check before moving to the next question.
Step 2: Other expenses
Print the type of expense you're claiming in the Description of claim box at question D15. If you're claiming for more than one type of expense, print 'multiple expenses' in the Description of claim box.
Step 3
Add up all the other expenses that you're claiming at this question (excluding election expenses).
Step 4
Write the amount from step 3 at question D15 – label J. Don't show cents.
Check before moving to the next question
Before moving to the next question, in your tax return:
- write the total amount of your deductible election expenses, if any
- print the type of other expenses you're claiming
- write the total amount of all other expenses you're claiming.
Where to go next
- Go to Total supplement deductions 2025.
- Return to main menu Individual supplementary tax return instructions 2025.
- Go back to question D14 Forestry managed investment scheme deduction 2025.