2017/18 Financial Year Tax Compliance
This financial year the Australian Tax Office (ATO) has declared a focus on work-related tax deductions. The ATO currently have concerns with the amount of work-related expenses that are being claimed and as a result, will be placing an increased focus on incorrect deductions.
The ATO released this statement warning taxpayers to avoid claiming work-related expenses that they are not entitled to this financial year due to the severe increase of incorrect deduction made last financial year.
This year, the ATO will audit the claims of work-related deductions in cases where the deductions are deemed too high for the individuals level of income and occupation as stated on the return. Individuals may be asked to justify the claimed amount by providing valid evidence as proof.
The ATO has three golden rules about claiming work-related expenses, these are:
You must have spent the money yourself and weren't reimbursed,
It must directly relate to earning your income, and
You must have a record to prove it.
Examples of records that you need to keep for work-related deductions, include: receipts or invoices, bank statements, and written evidence such as diary entries.
This year it is extremely important that people are claiming work-related deductions that can be substantiated, and that you are also declaring your correct occupation.