Income and allowance amounts you need to include in your tax return and amounts you don’t include.
Amounts you do and don't include
You must include all the income you receive as a meat worker during the income year in your tax return, this includes:
- salary and wages, including cash or bonus payments
- allowances
- compensation and insurance payments – for example, payments made under an income protection insurance policy to replace salary and wages.
Don't include as income any reimbursements you receive.
Your income statement or payment summary will show all your salary, wages and allowances for the income year.
Allowances
You must include all allowances your employer reports on your income statement or payment summary as income in your tax return.
An allowance is where your employer pays you an amount as an estimate of costs you might incur:
- to help you pay for a work expense – for example, tools and equipment
- as compensation for an aspect of your work such as working conditions or industry peculiarities – for example, working in the cold
- as an amount for having special duties, skills or qualifications – for example, first aid qualifications.
Your employer may not include some allowances on your income statement. Find out about declaring income and claiming deductions for allowances not on your income statement.
Allowances not on your income statement
If you receive an allowance from your employer, it does not automatically mean you can claim a deduction.
Your employer may not include some allowances on your income statement, you will find these amounts on your payslip. You don't need to declare these allowances as income in your tax return, unless you're claiming a deduction. Examples include travel allowances and overtime meal allowances.
If you spend the allowance amount on work expenses, you:
- don't include it as income in your tax return
- can't claim any deductions for the work expenses the allowance covers.
If you're not claiming a deduction, you don't need to keep any records of the amounts you spend.
If you spend your allowance on a deductible work-related expense, to claim a deduction you:
- include the allowance as income in your tax return
- include a claim for the work expenses you incur in your tax return
- must have records of your expenses.
If you can claim a deduction, the amount of the deduction is not usually the same amount as the allowance you receive.
Allowances and claiming a deduction
The following table sets out allowances you may receive and when you can claim a deduction.
Reason for allowance |
Example of allowance type |
Deduction (Yes or No) |
|---|---|---|
Compensation for an aspect of your work that is unpleasant, special or dangerous or for industry peculiarities |
Leading hand allowance Cold temperature allowance |
No These allowances don't help you pay for deductible work-related expenses |
An amount for certain expenses |
Clothing allowance |
Yes If you incur deductible expenses |
An amount for special skills |
A first aid certificate |
Yes If you incur deductible expenses |
Example: allowance assessable, no deduction
Nadia works at a meat processing plant. During her shift, Nadia spends time working in temperatures varying from minus 4⁰C to minus 10⁰C.
Nadia's employer pays her a cold temperature allowance of 62c per hour for each hour she spends working in those conditions.
At the end of the income year, Nadia's employer shows the total amount of the allowance on her income statement. Nadia must include the total allowance shown on her income statement as income in her tax return.
Nadia can't claim a deduction because she doesn't incur any deductible expenses. The allowance compensates her for her working conditions.
End of example
Example: allowance assessable, deduction allowable
Allan works at a meat processing plant. Allan's employer pays him an overtime meal allowance of $15.24 each time he works more than an hour and a half longer than his rostered finishing time. Allan does overtime 15 times during the year.
When he works overtime, Allan gets a meal break. On his meal break, Allan buys food and drink from the vending machine in the break room. He generally buys peanuts or chips, a bottle of soft drink and a chocolate bar which costs him around $12.
At the end of the income year, Allan's employer shows the total overtime meal allowance of $228.60 ($15.24 × 15 = $228.60) on his income statement.
Allan must declare the overtime meal allowance of $228.60 as income in his tax return.
Allan can claim a deduction for the food and drink he buys on his overtime break. Allan calculates his deduction as $180 ($12 × 15 = $180).
End of exampleReimbursements
If your employer pays you the exact amount for expenses you incur (either before or after you incur them), the payment is a reimbursement.
A reimbursement isn't considered 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
- you can't claim a deduction for the expenses.
Find out about meat workers: