"Your business success relies on strong foundations, and that includes understanding your own personal tax obligations. Knowing what you can claim helps you keep more of what you earn and strengthens your future."
Many First Nations business owners and community leaders spend significant time making sure their business tax obligations are in order, but it is just as important to focus on getting your personal tax return right.
This guide explains what you can and cannot claim on your personal tax return to help you maximise legitimate deductions while staying compliant with ATO rules.
Inside, you will find clear information about allowable claims, expenses you cannot claim, details on the Zone Tax Offset for remote areas, record-keeping requirements, and helpful ATO resources to make lodging your return easier and more confident.
The Golden Rules for Deductions
The ATO has three clear rules for any deduction you want to claim on your personal tax return. First, you must have paid for it yourself and not been reimbursed. Second, the expense must be directly related to earning your income. Third, you need to have a record to prove it. If you do not meet all three of these rules, you cannot claim the deduction.
What You Can Claim on Your Personal Tax Return
There are several types of expenses you may be able to claim in your personal return, depending on your work situation.
Car and Travel expenses can be claimed if you travel between different workplaces or job sites, or visit clients and suppliers. Normal commuting from home to your usual workplace is not deductible. You can claim using the cents-per-kilometre method (up to 5,000 km) or the logbook method for actual expenses. The ATO expects you to keep logbooks, receipts, and travel diaries for overnight trips. For more detail, see the ATO Car Expenses Guide.
Clothing and Laundry expenses are claimable if you buy compulsory work uniforms, protective clothing like high-vis or steel-caps, or occupation-specific items. Everyday clothes, even if you wear them at work, are not deductible. Keep purchase receipts and records of laundry costs. More information is in the ATO Clothing and Laundry Guide.
Home Office Expenses can be claimed if you work from home, even part-time. You may claim electricity and internet costs, depreciation on work equipment, and work-related phone and internet use. The ATO allows you to use either the fixed rate (70 cents per hour from 1 July 2024) or actual cost method. Employees cannot claim occupancy costs such as rent or mortgage interest. You will need a log of hours worked from home and relevant bills and receipts. See the ATO Home Office Expenses Guidefor more detail.
Self-Education and Training costs can be deductible if they directly relate to maintaining or improving skills for your current job. This includes course fees, textbooks, stationery, and depreciation on equipment such as laptops. You cannot claim study costs for training to get a new job or switch careers. Keep receipts and invoices as proof. Visit the ATO Self-Education Expenses Guide.
Tools and Equipment purchases are claimable if they are used for work. You can claim the full cost if it is $300 or less, or depreciation for items over $300. Repairs and insurance for work-related equipment can also be claimed. Keep receipts and depreciation schedules. More detail is in the ATO Tools and Equipment Guide.
Other Work-Related Expenses may include union fees, professional memberships, work-related journals and books, and safety gear not supplied by your employer.
Other Personal Deductions can include donations over $2 to registered charities (with receipts), last year’s tax agent fees, personal super contributions (if you have lodged a notice of intent with your fund), and costs to manage your tax affairs.
Zone Tax Offset
If you live or work in a remote or isolated area of Australia, you may be eligible for the Zone Tax Offset. This offset recognises the higher cost of living in remote locations.
To claim it, you need to have lived or worked in a designated zone for at least 183 days in the income year, or averaged over two years. The amount of the offset depends on your zone (Zone A, Zone B, or a special area).
You will complete the Zone Tax Offset section in your tax return. For details, including zone maps and eligibility criteria, see the ATO Zone Tax Offset Guide.
What You Cannot Claim on Your Personal Return
It is just as important to understand what the ATO does not allow you to claim.
You cannot claim the cost of everyday clothing such as suits, jeans, or shirts even if you wear them for work. Personal grooming and maintenance expenses such as haircuts, cosmetics, or gym memberships are not deductible.
Employees cannot claim home occupancy costs like rent, mortgage interest, council rates, or insurance. For work-from-home claims, you can only claim running costs such as electricity using the fixed-rate or actual-cost methods.
Normal commuting from home to your regular workplace is considered private and is not deductible. Entertainment expenses such as meals or drinks for social occasions are also excluded. Finally, you cannot claim expenses that your employer reimbursed.
What Records Do You Need?
The ATO requires you to keep records for five years after lodging your return. This includes receipts and invoices, bank statements showing relevant transactions, logbooks for car claims, records of hours worked from home, and travel diaries for overnight work trips. Digital copies are accepted as long as they are clear and legible.
ATO Occupation-Specific Guides
The ATO offers detailed guidance for different occupations and industries, which can be especially useful if you work in a specific role or manage staff with different needs.
These guides cover professions such as nurses and midwives, tradies, teachers, real estate agents, and defence force members.
You can browse the full list here: ATO Occupation Guides.
Final Word
Managing your business finances is only part of the story. Understanding your personal tax deductions ensures you claim what you are entitled to while staying compliant.
Be sure to follow the ATO’s guidelines, keep clear records, and seek advice from a registered tax agent if you are not sure.
If you need support with your personal or business tax obligations, reach out. We are here to help.
