Keep Your Receipts: The ATO Is Cracking Down On Tax Claims

The Australian Tax Office has warned taxpayers that there will be a crack down on 'other work-related expenses' this year.

The ATO recommends that you keep appropriate record on hand to make sure that you're not caught out.

Last year, 6.7 million taxpayers claimed over $7.9 billion in deductions for 'other work-related expenses'.

Assistant Commissioner Kath Anderson said that the stricter enforcement of rules will be implemented as "it's a significant amount of money and Australians expect us to ensure that people are not over-claiming".

Appropriate 'other work-related expenses' include home office, union fees, mobile phone, internet, overtime meals, tools and equipment.

“However, they are only deductible if they meet the three golden rules," Assistant Commissioner Anderson said.

"Firstly, you must have paid for it and not been reimbursed, secondly, it must be directly related to earning your income and not a private expense, and thirdly, you must have a record to prove it.

“Many taxpayers make legitimate claims, but we are also seeing errors in some claims, and some taxpayers are making risky or outright false claims.

“Substantiation will be a key focus area for the ATO this year. It’s important that you have a record of the expense and can demonstrate how you calculated your claims.

"Every year we disallow lots of claims because there is no evidence to prove the expense. Yet it’s so easy to keep an electronic record.”

Another piece of advice is to ensure that the proper amount of deduction is lodged for claims.

“If your expenses are for both work and private use you can only claim a deduction for the work-related portion," Assistant Commissioner Anderson said.

"We are seeing quite a few examples of people trying to claim the whole expense, including the private portion. Like some who incorrectly claim their entire phone and internet bundle, and others who claim an overseas study trip even though they had a holiday as part of the trip."

To find out more about what deductions you can legitimately claim this tax time, visit: ato.gov.au/deductions

To find out more about the penalties for making false or misleading statements, visit: ato.gov.au/penalty

For more information myDeductions, visit: ato.gov.au/mydeductions.