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Agriculture industry expenses A–F

Last updated 2 June 2023

All-terrain and utility vehicle expenses

You can claim a deduction for the work-related use of an all-terrain vehicle (ATV) if you need to cover large distances that you can't get to by car. For example, you use a quad bike to check on livestock in a paddock that you can't get to by car.

You can claim a deduction for the:

  • decline in value of the ATV, if you pay for the vehicle yourself
  • running costs you incur, such as fuel, oil, repairs and maintenance.

You can't claim a deduction if your employer or a third party reimburses you for costs you incur.

If you use the ATV for work and personal purposes, you can only claim a deduction for your work-related use.

In your tax return, include the deduction at Other work-related expenses. To work out any decline in value use the Depreciation and capital allowances tool.

Award transport payments (fares allowance)

You can claim a deduction for expenses covered by award transport payments, if the expenses are for work-related travel and you have actually spent the money.

You will need to be able to show how you work out you claim if we request this information. You don’t need written evidence if your claim is less than the amount in the award as at 29 October 1986. If you're unsure of this amount, your union or employer can tell you.

Allowances you receive from your employer for transport or car expenses that are paid under an award must be included in your tax return. These allowances are assessable income.

Car expenses

You can't claim a car expenses deduction for normal trips between your home and regular place of work, even if you:

  • live a long way from your usual or regular workplace
  • work outside normal business hours (for example, weekend or early morning shifts).

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 or where you had shifting places of employment.

To be able to claim a deduction for the cost of trips between home and work while carrying bulky tools or equipment, all the following conditions must be met:

  • the tools or equipment are essential to perform your employment duties
  • the tools or equipment are bulky, meaning that    
    • because of the size and weight, they are awkward to transport
    • they can only be transported conveniently using a motor vehicle
  • there is no secure storage for such items at the 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 are considered to have shifting places of employment where you have no fixed place of work and you continually travel from one work site to another before returning home.

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

  • directly between separate jobs on the same day – for example, travelling from your first job as a fruit picker directly to your second job to test soil for crop research
  • to and from an alternative workplace for the same employer on the same day – for example, travelling between cane fields for your employer
  • from home directly an alternate workplace – for example, travelling from home to a workplace which is not your regular work location.

You can't claim car expenses for a car you use under a salary sacrifice or novated lease arrangement. This is because it's usually your employer leasing the car from the financing company and making it available for your use. You can however claim additional work-related expenses you incur that are associated with your work use of the car such as parking and tolls.

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 work out the percentage of work-related use along with written evidence of your car expenses.

If you use the cents per kilometre method, you need to be able to show how you work out your work-related kilometres. You must be able to show that the kilometres travelled were work-related.

If you claim your work-related car expenses using one of the above methods, you can’t claim any further deductions in the same tax return for the same car. For example, petrol, servicing, and insurance costs.

To claim a deduction in your tax return, include the amount of your claim at Work-related car expenses. The Work-related car expenses calculator can help you work out the amount you can claim as a deduction.

You can’t use the cents per kilometre or logbook methods to work out your claim for a:

  • motorcycle
  • vehicle with a carrying capacity of one tonne or more (such as a ute)
  • vehicle that can transport 9 passengers or more (such as a minibus).

For these vehicles, you can claim the actual expenses you incur for your work-related travel. This includes costs such as fuel, oil, insurance and loan interest along with the decline in value of the vehicle. You must keep receipts for all your expenses and records to show your work-related use of the vehicle. Although you are not required to keep a logbook, it is the easiest way to calculate your work-related use of your vehicle.

To claim a deduction for actual expenses you incur for a vehicle not defined as a car, include the amount at Work-related travel expenses.

Example: no secure storage

Mike is an employee full-time fencer and travels to his employer's farms to fix fences. He has to carry bulky machinery and tools between his home and workplace each day to perform his duties. His tools include a powered post driver, shovel, hammer, tensioner and wire cutters.

Mike's employer has 7 properties. The main farm has storage but due to the distance between the properties and the fact that Mike does not always go to the main farm to work, it isn't practical for Mike to store the fencing tools at the main farm after each shift.

Mike can claim a deduction for the expenses he incurs to transport his tools and machinery from home to:

  • the first farm he travels to each day
  • between the farms during the day
  • from the last farm he performs works at to his home at the end of each day.
End of example

 

Example: from alternative workplace to home

Richard works as a dairy farmer for a large company in rural NSW. He has to attend a monthly meeting with distributors in Sydney. Richard uses his own car to travel to the meetings. Richard goes straight home after the meetings because they finish late.

Richard can claim the cost of travelling from his regular workplace in rural NSW to the meeting in Sydney, and then to his home. Richard keeps a record of his kilometres using the myDeductions tool in the ATO app. He uploads his records into his tax return at tax time.

End of example

Child care

You can't claim a deduction for the cost of child care (including school holidays and before and after school care) when you're working. It's a private expense, and the expenses have no direct connection to earning your income.

Clothing and uniform expenses (including footwear)

With a few exceptions, clothing can't be deducted as a work-related expense.

You can't claim conventional clothing (including footwear) as a work-related expense, even if your employer requires you to wear it and you only wear these items of clothing at work.

'Conventional clothing' is everyday clothing worn by people regardless of their occupation – for example, jeans, drill shorts and shirts or business attire.

You can claim a deduction for costs you incur to buy, hire, repair or replace clothing, uniforms and footwear you wear at work if it's in one of the following categories:

  • protective – clothing that has protective features of functions that you wear to protect you from specific risks of injury or illness at work. For example, steel-capped boots, fire-resistant clothing, or tear-proof pants. Conventional clothes you wear at work are not regarded as protective clothing if they lack protective qualities designed for the risks of your work. This includes jeans, drill shirts, shorts, trousers, socks and closed shoes.
  • occupation-specific – clothing that distinctly identifies you as a person with a particular profession, trade or occupation. For example, a judge's robes or a chef's chequered pants. Items traditionally worn in a profession are not occupation-specific where the clothing is worn by multiple professions.
  • a compulsory uniform – clothing that your employer strictly and consistently enforces you wear by workplace agreement or policy and distinctly identifies either    
    • you as an employee working for a particular employer
    • the products or services your employer provides
  • a non-compulsory uniform – clothing that your employer registers on the Register of Approved Occupational Clothing with AusIndustry.

You can't claim a deduction if your employer buys, repairs or replaces your clothing.

Example: conventional clothing

Bob is an employee on a poultry farm. He wears jeans with t-shirts or long sleeve shirts at work as they're comfortable. While the jeans and shirts afford Bob some protection from the sun, 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 the rigorous working conditions Bob experiences in his job.

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

After a couple of weeks on the farm, Bob notices he is getting sunburnt through his shirt. He buys some UPF 50 sun protection work shirts and starts wearing them to work.

Bob can claim a deduction for this expense as they are specifically designed to protect him from harm that he is exposed to whilst at work.

End of example

 

Example: protective clothing

Len is an employee shearer. He buys items specifically designed for shearers to protect them while working. The items consisted of jeans which repel lanolin, singlets with leather inserts at the point where sheep are held to protect against lanolin and grease; boots with special lacing and flaps to keep out wool clippings and shearers' moccasins which prevent slipping on greasy shearing shed floors.

Len can claim a deduction for the cost of his jeans, singlets, boots and moccasins because the items:

  • protect Len from the harm he is exposed to as a shearer
  • are paid for by Len and aren't reimbursed by his employer.

If, however, the items were ordinary everyday clothing such as normal jeans, a singlet and boots rather than protective clothing made specifically for shearers, he would not be able to claim a deduction.

End of example

Drivers licence

You can't claim a deduction for the cost to get or renew your drivers licence, even if you must have it as a condition of employment. This is a private expense.

You can claim a deduction for additional costs you incur to get a special licence or condition on your licence to perform your work duties. For example, the cost you incur to get a heavy vehicle permit.

Example: heavy vehicle permit

Mick is an employee fruit picker on a rural farm. As part of his job, he requires a driver's licence and a heavy vehicle permit as he drives a truck to transport the fruit. It costs Mick $50 to renew his drivers licence each year and $75 to apply for the heavy vehicle permit.

Mick can't claim a deduction for the cost to renew his driver's licence ($50) as it is a private expense.

Mick can claim the cost of the heavy vehicle permit ($75) as it's an additional expense which directly relates to his employment duties.

End of example

Fines and penalties

You can't claim a deduction for any fines or penalties you get when you travel to work or during work. Fines may include parking and speeding fines or penalties. For example, a fine you receive for overloading your truck.

Firearms and guns

Where there is a direct connection to your work duties as an agricultural worker, you can claim a deduction for the:

  • decline in value of firearms and guns
  • maintenance of firearms and guns
  • cost of ammunition
  • costs you incur to renew a gun licence.

For example, if you require a gun to control vermin on the farm you manage.

You can't claim a deduction if your employer pays for or reimburses you for these expenses.

Example: gun license for work duties

Trent grew up in rural Victoria and has always enjoyed shooting, he regularly visits the shooting range.

Trent works part-time as an employee to help his uncle control vermin on his farm, particularly wild dogs that attack sheep at night. Trent provides his own firearms and equipment and his employer pays for the ammunition.

As Trent needs his gun licence for work purposes, he can claim the licence renewal costs. As Trent also uses his firearms for recreational purposes, he can only claim the work-related portion of the renewal expense.

Trent can't claim the ammunition as his employer provides this.

Trent buys a special scope for his gun that he uses to shoot the vermin. His employer does not reimburse him for the scope. The scope costs $600. As it costs more than $300, Trent can claim the decline in value of the scope over its effective life. As with the renewal of his gun licence, Trent can only claim a deduction for his work-related use of the special scope.

Trent can also claim the decline in value of his guns and related equipment, but he must apportion the amounts between private and work use. The guns and related equipment start to decline in value when he first uses them for private purposes, so if Trent has had the guns and equipment for longer than their effective life, he can't claim a deduction for their decline in value.

End of example

First aid courses

You can claim a deduction for the cost of first aid training courses if you are both:

  • a designated first aid person
  • need to complete first aid training to assist in emergency work situations.

You can't claim a deduction if your employer pays for or reimburses you for the cost of the course.

For more agricultural worker expenses, see:

QC61560