• Electricians – claiming work-related expenses

    To claim a work-related deduction:

    • you must have spent the money yourself and weren't reimbursed
    • it must be directly related to earning your income
    • you must have a record to prove it

    However, there are some instances where you have to meet other conditions.

    Claim the correct amount for the year

    • You must have incurred the expense in the year you are claiming the deduction, unless the expense relates to the decline in value (depreciation) of tools or equipment you purchased.
    • When claiming the decline in value of your tools or equipment, you must have used them or had them available for use in the year you are making the claim.
    • You can only claim that part of an expense that relates to your work.

    Remember:

    • When you complete the declaration on your tax return, you are declaring that everything you have told us is true and you can support your claims with written evidence.
    • You are responsible for providing proof of your expenses, even if you use a registered tax agent.

    Reimbursements and allowances

    • If your employer or any other person reimburses you for expenses you have actually incurred, the payment is called a reimbursement. An allowance is not considered to be a reimbursement.
    • You cannot claim a deduction for expenses you incur if those expenses are reimbursed to you by your employer – you do not include a reimbursement on your tax return.
    • If you claim your motor vehicle expenses from your employer using the cents per kilometre method, the amount you receive is considered to be an allowance.
    • Regardless of the amount of an allowance you receive, you can claim a deduction only for the expenses you paid – that is, if you paid $80 in work-related expenses, and you received a $100 allowance for those expenses, you can still only claim $80.

    If you received a car allowance or an award transport payment from your employer, you must record the amount you received as income at item 2 on your tax return.

    Evidence to support your claims

    If your total claims add up to more than $300 (excluding claims for car, meal allowance, award transport payments allowance and travel allowance expenses), you must keep written evidence, such as receipts. Your written evidence must show you incurred the full amount of your claim, not just the amount over the first $300.

    If the total amount you are claiming is $300 or less, you do not need to keep receipts, but you must be able to show how you worked out your claims.

    Work-related daily travel expenses

    You can claim the cost of travel you undertake in the course of performing your duties as an employee.

    You may be able to claim work-related travel expenses for:

    • transporting bulky tools and equipment
    • travelling between workplaces
    • shifting places of employment.

    Transporting bulky tools and equipment

    You can claim a deduction for the cost of transporting bulky tools and equipment between home and work if:

    • you need to use them at work
    • there is no secure area for storing them at your workplace.

    Travelling between worksites

    You can claim a deduction for the cost of trips between worksites on the same day – this includes travelling between:

    • different worksites for the same employer
    • separate places of employment providing neither workplace is your home.

    Shifting places of employment

    You can claim the cost of trips between home and work if you regularly work at many sites each day before returning home.

    Example 1:

    Matt is an electrician who does maintenance work and uses his own vehicle. Every day he travels to several sites. He carries a large extension ladder on his roof rack, a tool box, reels of cable and boxes of switches.

    Matt is entitled to a deduction for his vehicle expenses because he has shifting places of work. He is also entitled to a deduction because he transports bulky tools and equipment between his home and the worksite.

    End of example

    See also:

    Daily travel expenses you cannot claim

    You cannot claim a deduction for the cost of normal trips between home and work, even if:

    • you used a car because there was no public transport near where you worked
    • you worked outside normal business hours – for example, shift work or overtime
    • you were on call
    • you used your own vehicle to travel from home to work to collect a work vehicle.

    Example 2:

    Paul's employer provides vans for his employees. The vans are fully equipped with all the materials and tools they need to carry out their duties. Paul travels by car to his employer's head office where he picks up the work van then drives to the job. Paul cannot claim a deduction for the car expenses he incurs when he travels between his home and work.

    End of example

     

    Example 3:

    Tony works on a large project where secure storage is available for his tools. Because Tony chooses to transport his tools to and from work every day, instead of leaving them in the secure storage provided, he cannot claim a deduction for transporting his tools to and from work.

    End of example

    Keeping records of your daily travel expenses

    Car expenses

    The records you need to keep and how you work out your claim will depend on whether the vehicle you use is considered to be a car and whether you own or lease it. Your vehicle is not considered to be a car if it is:

    • a utility, truck or panel van with a carrying capacity of one tonne or more
    • a vehicle with a carrying capacity of nine or more passengers
    • a motorcycle.

    Find out about:

    Methods of working out your car expenses

    The deduction you can claim must be worked out using one of two methods. The records you must keep will depend on:

    • the estimated amount of business kilometres you travelled for the income year
    • which method you use for claiming car expenses.

    See also:

    The logbook method

    To work out your deduction using the logbook method, you must keep:

    • a logbook
    • odometer records
    • receipts and other written evidence for all your car expenses. You can use your odometer readings to estimate your fuel and oil costs instead of keeping receipts.
    The cents per kilometre method

    When working out your deduction using the cents per kilometre method:

    • you don't need receipts or other written evidence, but we may ask you to show how you worked out your estimate of business kilometres. For example    
      • by using a diary of work-related travel
      • by basing your costs on a regular pattern of travel
       
    • you can only claim up to the first 5,000 business kilometres you travel.

    Car expenses are claimed at item D1 Work-related car expenses on your tax return.

    Next step:

    Vehicles other than cars

    If your vehicle is not a car – for example, a van or ute with a carrying capacity of more than one tonne – you must keep records for all expenses you incurred. Those records may include receipts for:

    • fuel and oil
    • repairs and servicing
    • interest on a car loan
    • lease payments
    • registration.

    If you use your vehicle for work and private use, you can use a diary to show how much of those expenses relate to business and personal use of the vehicle.

    You claim these expenses at item D2 Work-related travel expenses on your tax return.

    See also:

    Other daily travel expenses

    You will need to keep records for other daily travel expenses you incur on work trips, such as:

    • car parking
    • bridge and road tolls
    • taxi and bus fares.

    You claim these expenses at item D2 Work-related travel expenses on your tax return.

    Work-related overnight travel expenses

    When you can make a claim

    You can claim a deduction for overnight travel expenses where:

    • your employer requires you to travel to a worksite to perform work
    • you have to sleep away from home overnight in the course of performing that work
    • you are not living away from home.

    Overnight travel expenses include meals, accommodation and incidental expenses.

    If you are claiming overnight travel expenses, and you received a travel allowance from your employer, you must record the allowance as income at item 2 on your tax return.

    See also:

    Overnight travel expenses you cannot claim

    You cannot claim a deduction for the travel expenses you incur if:

    • your employer reimburses your expenses or provides the relevant accommodation, meals or incidentals
    • you get a job that results in you having to incur travel expenses because you choose not to relocate.

    If you live away from home to perform your work, you may receive a living-away-from-home allowance from your employer. You do not include a living-away-from-home allowance as income on your tax return.

    Note: Your employer should not show a living-away-from-home allowance on your payment summary – if it does appear on your payment summary, check with your employer that it has not been shown by mistake.

    Example 4:

    Joe lives in the city with his family and applied for a job to work on a large construction project near a country town for 12 months. He is paid a living-away-from-home allowance by the construction company to meet his accommodation and meal costs while he lives in the country town. Joe is not entitled to a deduction for his accommodation and meal expenses. The allowance is not shown on Joe's payment summary and he does not declare it as income.

    End of example

    Keeping records of your overnight travel expenses

    Expenses for which you do not have to keep records

    You can claim a deduction for the amount you spend on travel expenses without keeping all your records if:

    • you received a travel allowance to cover your accommodation, meals or incidental expenses (a token amount paid as a travel allowance is not accepted as reasonably covering such costs)
    • your travel expenses were equal to or less than the reasonable allowance amount we set.

    However, we may ask you to explain how you worked out the amount you claimed.

    If the allowance is not shown on your payment summary and was not more than the reasonable allowance amount, you do not have to show it on your tax return if you:

    • spent the entire allowance on deductible expenses
    • are not claiming the deduction.

    Otherwise, you must show the allowance on your tax return.

    We set the reasonable allowance amount for your circumstances in an annual taxation determination that explains:

    • when you do not need evidence of your expenses
    • the way in which you can claim them.

    Note: The receipt of a travel allowance does not mean that you can automatically claim the reasonable allowance amount set out in the annual taxation determination. You can only claim the amount you actually spend on accommodation, meals and incidental expenses.

    See also:

    Example 5:

    Jamie travels from Adelaide to Mt Gambier to install lights in a new school, and is away from home for five nights. His employer pays him a travel allowance of $110 per night for accommodation, meals and incidentals. The allowance is not shown on his payment summary.

    The travel allowance amount paid to Jamie is less than the reasonable allowance amount; he spends all of the travel allowance on his travel expenses.

    Jamie chooses not to include his allowance on his tax return because:

    • it is less than the reasonable allowance amount
    • it is not shown on his payment summary
    • he spends it all to cover his travel expenses.

    This means Jamie cannot claim a deduction for his expenses on his tax return.

    End of example

    Expenses for which you must keep records

    If you are claiming more than the reasonable allowance amount, you must keep records to show the full amount you spent, not just the amount over the limit. These records include:

    • a travel diary if your travel is six or more nights in a row – that is, a document that shows the dates, places, times and duration of your activities and travel
    • invoices, receipts or other documents showing your travel expense details – if it is too difficult to get a receipt for a meal you purchased, for example, if you purchase a meal from a vending machine, you can keep diary entries as proof of purchase.

    If you do not receive a travel allowance, you must keep all of your records.

    If you received a travel allowance that is more than the reasonable allowance amount, you must show the allowance as income at item 2 on your tax return.

    If you received a token amount paid as a travel allowance

    If you received a token amount as a travel allowance that could not reasonably be expected to cover your costs for accommodation, meals and incidental travel expenses, you must show the total amount you received as income on your tax return. You must also keep records to show the full amount you spent when you claim a deduction.

    Claim overnight travel expenses at item D2 Work-related travel expenses on your tax return.

    Other work-related expenses

    Unless indicated otherwise, claim the following expenses at item D5 Other work-related expenses on your tax return.

    Protective equipment and clothing

    You can claim a deduction for protective equipment you use on the job that costs $300 or less in the year you incur the expenses. This includes equipment such as helmets, harnesses and goggles. You cannot claim a deduction for protective equipment costing more than $300 that is used over a longer period. You can claim a deduction for its decline in value.

    Examples of protective clothing include:

    • fire-resistant and sun-protection clothing
    • safety-coloured vests
    • rubber boots
    • steel-capped boots, gloves, overalls, heavy-duty shirts and trousers that are designed to protect the wearer from risk of injury at work.

    Jeans, drill shirts and trousers that are not designed to protect the wearer are not considered to be protective clothing.

    Claim your expenses for protective clothing items at item D3 Work-related uniform, occupation specific or protective clothing, laundry and dry-cleaning expenses on your tax return.

    Tools and equipment

    You can claim the decline in value on your tools and equipment. The amount you can claim depends on the amount of time you use them for work purposes – for example, if you own a power tool which you use half for business purposes and half for private purposes, you can claim only half the decline in value.

    You can claim that part of the cost of a tool or piece of equipment, based on how much you used it for work purposes, if it either:

    • does not form part of a set and it cost $300 or less
    • forms part of a set and the set cost $300 or less.

    You can also claim the work-related cost of repairing and insuring your tools and equipment, and any interest charges you incurred on money you borrowed to purchase these items.

    Sunglasses, sunhats and sunscreens

    You can claim a deduction for these items if you:

    • have to work in the sun for all or part of the day
    • use these items to protect yourself from the sun while at work.

    Home office expenses

    If you maintained an office at home where you carried out tasks for work, then you should have a look at the Home office expenses calculator to see what you are eligible to claim.

    Note: Making work-related phone calls from home won't necessarily mean that the room from which you make those calls qualifies as a home office.

    See also:

    Overtime meals

    You can claim a deduction for overtime meal expenses if you:

    • received an overtime meal allowance under an industrial award for working overtime
    • purchased a meal when you worked overtime.

    You must include the allowance you received on your tax return if you:

    • have an overtime meal allowance shown on your payment summary
    • are claiming a deduction and the allowance is not shown on your payment summary
    • received an allowance in excess of the reasonable allowance amount.

    If the overtime meal allowance is not shown on your payment summary and was not more than the reasonable allowance amount, you do not have to show it on your tax return if you:

    • spent the entire allowance on expenses for which you can claim a deduction
    • are not claiming a deduction.

    If your overtime meal allowance is already included in your normal salary or wage (not included as a separate allowance on your payment summary), you cannot claim a deduction for it.

    Note: The receipt of an overtime meal allowance does not mean that you can automatically claim the reasonable allowance amount set out in the annual taxation determination. You can only claim the amount you actually spend on overtime meal expenses.

    See also:

    Records you must keep

    You must keep records of your work-related expenses, these can be:

    • receipts, or other written evidence of your expenses, including receipts for depreciating assets you have purchased
    • diary entries you make to record your small expenses ($10 or less) totalling no more than $200, or expenses you cannot get evidence for, regardless of the amount
    • itemised phone accounts on which work-related calls can be identified
    • a diary you have created to work out how much you use your equipment, home office and phone for business purposes over a representative four-week period
    • payment summaries showing items such as overtime meal allowances.

    See also:

    For information about particular types of work-related expenses, refer to:

    If you need help applying this information to your own situation, phone us on 13 28 61.

      Last modified: 15 Aug 2017QC 21829