Refund’s in the bag for work deductions
SOME of the biggest tax deductions available to workers today did not exist just 10 years ago.
A surge in technology and people bringing work home is allowing millions of Australians to claim deductions for their work- related use of smartphones, tablet computers and the things used to carry those items – handbags, manbags and satchels.
The ATO last year clarified that handbags could be tax- deductible if used for carrying documents, phones and tablet computers to the office, similar to how briefcases have been deductible for decades.
Kate Bruce, 31, is currently searching for a handbag that can carry her work materials.
“Of course, I’d need to figure out how much I use it for work and how much would be for personal use,” said Ms Bruce, an accountant at dmca advisory.
“I think at tax time people need to be careful to ensure that they can distinguish between a fashion handbag purchased just because you like it and one purchased only for work.”
You can only claim for the workrelated proportion of use of any item, and may need a logbook or other record of use.
NDA Law managing director Andrea Michaels said you could not claim a small evening bag or one that wouldn’t fit your work items.
“The cost of the bag itself is not relevant, but the more expensive the bag, the more likely the ATO will question it, so your ability to substantiate your claim is important,” she said. “Technology has fuelled a raft of new tax deductions in the last 10 years.”
As well as claiming for phones and computers, workers could potentially claim deductions for phone plans, internet services, apps and cloud storage, Ms Michaels said.
“Other new work deductions include business card scanning apps and the use of online website hosts,” she said.
H & R Block’s director of tax communications, Mark Chapman, said work- related items costing less than $ 300 could be claimed fully in the year they were bought.
“If it’s more than $ 300, you will need to depreciate it ( over several years),” he said.
However, there was no limit on the number of work- related items that could be bought and written off, Mr Chapman said. WORK, NOT PLEASURE: Accountant Kate Bruce with a handbag that can be tax- deductible when used for work.