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Can you really claim a tax deduction on your handbag?

You may not be aware that your handbag is one of many deductions you can make at tax time. Shoes, dance classes, make up and even dogs are just some of the other things you might be able to claim.

The main thing with any deduction is you need to be able to prove it is for work purposes. What you can claim and how much you can claim largely depends on the industry you work in. Luckily, the ATO has over 30 guides for specific industries.

Read on below for some of the more interesting deductions you may be able to claim.

 1.  Your handbag

As mentioned, provided it is used for work to carry your laptop, phone, stationery and other work supplies, you can claim it!

2. Shoes and clothing

Non slip work shoes for nurses, specific shoes for flight attendants and work boots for various occupations are just a few examples of the types of shoes you can claim depending on your work. For work clothing, it must be a uniform such as work clothing with a logo on it to be able to claim it.  You cannot claim a business suit.

3. Electricity

Many people now carry out part of their work from home.  Even if you didn’t before, it’s likely that you will have during Covid-19. Regardless of whether you have a full home office, you can still claim between 52c to 80c per hour for electricity, gas and lighting expenses while you work.  Keep accurate records of it all.

4.  A dog!

Before you get too excited, you can only claim a dog if it directly relates to work such as security or farm work. Expenses such as food and vet bills can be claimed by business owners.  As for home based businesses, the family dog can be viewed as a grey area if your dog is used to secure the premises.  Your gorgeous pug isn’t going to be claimable.

5. Donations

Whether you donate to a charity or make political donations, amounts over $2 are tax deductible.

6.  Mobile phone

Do you use your personal phone for work calls? If so, you might be able to claim it. It’s important you keep accurate records as you can only claim the work portion of the bill, not your whole bill. For example, if around 50% of the use of your phone is for work, you can claim 50% of the bill.

 7. Courses and seminars

If you are attending courses, getting an education or even attending investment seminars, they can be tax deductible. Courses and self-education needs to be directly related to your job and investment seminars need to be for an investment you already have such as a rental property.

 8. Car expenses

When using your car for work, keep accurate records.  Wear and tear, maintenance and petrol can all be claimed.  There are rules around what you can claim and when so keeping records helps prove it.

9.  Home office expenses

Setting up your home office can be costly, but you can claim a deduction or depreciation on everything you buy for it from computers to printer ink. Electricity and other expenses can also be included.  Write down everything and claim what you can.

 10. Union and membership fees

The total costs of fees associated with your employment such as union or membership fees for a professional body relating to your work are tax deductible.

 11. Tax agent fees

When an agent prepares your tax return you can claim it the following year.

 12. Laundry

If your entire laundry load consists only of work clothing (such as uniforms), you can claim $1 per load.  If it’s a mixed load of work and personal items, you can claim 50 cents per load as laundry expenses.  You can also claim dry cleaning for general work clothing, but if the total amount is over $300 you will need proof.

 13. Caravans

You can’t claim the family caravan every time you take a trip, but if you travel for work and decide to use a caravan instead of paying for hotels and motels, you can claim it.  You need to prove it is for business and not personal use.

14. Investment property expenses

Did you know most landlords can claim 2.5% depreciation on the cost of bricks and mortar?  While investment properties have a plethora of deductions you can make, including garden gnomes, many landlords forget about depreciation.  This is why it is so important to get the right advice with your investments.

 15. Superannuation

Salary sacrificing, boosting your super or splitting it with your partner are just a few of the tax-effective tips we share in this article.  Get your super sorted and use it to your advantage both on your tax this year and in the future.

 16. Sunscreen and makeup

Gardners, builders, construction workers and anyone else working outside can claim their sunscreen. Further to the sunscreen, if you are required to work outdoors and your makeup has a sun protection element to it, you can claim that as well.

17. Subscriptions 

Industry-specific magazines and other subscriptions you pay for which relate to your work can be claimed on your tax.

With all deductions, it is important you keep accurate records to prove what you paid, when you paid it and that it was used for work purposes.  While some amounts might seem small, they all add up and can make a big difference come tax time.  The sooner you track it, the more you can claim!

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Our response to limit the spread of COVID-19

  • As COVID-19 continues to spread, we would like to take a moment to let you know what Financial Spectrum is doing to respond.

    While we haven’t been directly affected with any confirmed cases, we are taking all reasonable precautions to remain safe.Our priorities are:

    1. Keep our staff and clients safe
    2. Stay fully operational in our service delivery and continuing to manage your financial affairs
    3. Play our part in minimising the impact on our community against the spread of COVID-19

    Financial Spectrum has the technology, infrastructure and systems to continue business as usual remotely and our staff will now be working from home.

  • You should notice no change to our service, with the exception that we are encouraging our clients to meet via video call, rather than face to face, unless requested. We will be contacting all clients with meetings booked over the next two weeks with instructions for a video call.This is an evolving situation and we will continue to monitor developments. We will keep you informed of any material changes to our approach.

    These are unprecedented times and we understand that many of you will be feeling unsettled about your finances. We would like to assure you that we are open for business and are here to help you. If you don’t have a meeting booked but would like one, or if you have questions, please contact us at info@financialspectrum.com.au or on
    02 8238 0888

Brenton Tong

Managing Director

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