What Can You Claim on Your Tax Return? A Plain-English Guide to Work-Related Deductions (2025-26)

Before you claim anything, the ATO applies the same three tests to every work-related deduction. First, you must have spent the money yourself and not been reimbursed by your employer. If your employer paid for it or paid you back, you cannot also claim it. Second, the expense must directly relate to earning your income, not your private life. Third, you must have a record to prove it.

Where an expense is partly for work and partly private, you can only claim the work-related portion. A classic example is a mobile phone or home internet bill: you work out the percentage you use for work and claim only that share. The same applies to a laptop used for both work and streaming.

Some costs are never deductible, no matter how the rules are framed. You cannot claim the normal trip between home and work, the cost of buying lunch on a workday, conventional clothing (such as a plain suit, black trousers or a white shirt) even if your employer requires it, childcare, or fines and penalties like parking and speeding tickets. These are treated as private in nature.

If you are unsure whether something qualifies, the ATO publishes occupation-specific guides (for nurses, teachers, tradies, drivers and dozens of others) that list what people in your job typically can and cannot claim. A registered tax agent can also confirm your specific situation.

If you work from home, the simplest option is the fixed rate method. For the 2024-25 income year this is 70 cents for every hour you actually worked from home. The rate bundles together the running costs that are hard to split out: electricity and gas, internet and data, mobile and home phone use, and stationery and computer consumables. Because phone and internet are already inside the 70 cents, you cannot also claim them separately on top.

To use the fixed rate you need two kinds of records. You must keep a record of the total hours you actually worked from home across the whole year, for example a timesheet, roster or diary. An estimate is not accepted by the ATO. You also need at least one bill for each type of running expense the rate covers, for instance one electricity bill and one internet bill, to show you genuinely incurred those costs.

The fixed rate does not cover the decline in value of equipment. You can still separately claim the work-related depreciation of bigger items such as a desk, office chair, computer or laptop used while working from home.

The alternative is the actual cost method, where you work out the real work-related portion of each running expense. It can produce a larger deduction but requires far more detailed records. The ATO's home office expenses calculator covers income years up to 2025-26 and can help you compare the two. Rates can change between years, so confirm the current year's hourly rate at ato.gov.au before you lodge.

You generally cannot claim the ordinary commute between home and work, that is treated as private. You can claim car expenses for work-related driving such as travelling between two separate workplaces, visiting clients or job sites, or carrying bulky tools your employer requires you to transport when there is no secure place to store them at work.

There are two methods for a car you own or lease. Under the cents-per-kilometre method the rate is 88 cents per kilometre for 2025-26. It covers all your running costs (fuel, servicing, registration, insurance and decline in value) in the single rate, and is capped at 5,000 work kilometres per car, a maximum claim of $4,400. You do not need receipts, but you do need to show how you worked out your kilometres, for example a diary or calendar of work trips.

If you drive more than 5,000 work kilometres, you must use the logbook method to claim the full amount. This requires a logbook kept for a continuous 12-week period that establishes your work-use percentage, plus records of your actual car costs. The logbook is generally valid for five years.

Other work travel, such as flights, public transport, tolls, parking (but not parking fines) and accommodation on overnight work trips, can be claimed where it directly relates to your work and you have records. Per the rules above, travelling between home and a regular workplace is not deductible.

You can claim the work-related portion of tools, equipment and technology you buy to do your job, such as power tools for a tradie, a laptop, a printer, professional instruments or industry-specific software. The key split is the cost of the item.

If an item costs $300 or less, and it is mainly for work, you can usually claim the full cost as an immediate deduction in the year you buy it. There are a few conditions: the item cannot be one of several near-identical items that together cost more than $300, and it cannot be part of a set that together costs more than $300.

If an item costs more than $300, you generally cannot deduct the whole cost at once. Instead you claim the decline in value (depreciation) gradually over the asset's effective life. Only the work-related percentage is deductible, so a laptop used 60% for work means you claim 60% of the depreciation. The ATO's depreciation and capital allowances tool can do the calculation for you.

You can also claim consumables and smaller running costs that relate to work, such as stationery, professional books and journals, and work-related phone and internet (apportioned for private use), provided they are not already captured inside the working-from-home fixed rate.

Clothing is one of the most misunderstood areas. You cannot claim conventional or everyday clothing, even if you only wear it to work and even if your employer requires a particular look, for example plain black trousers and a white shirt. The cost is treated as private.

You can claim clothing that falls into specific categories: occupation-specific clothing that distinctly identifies your job (such as a chef's checked pants), protective clothing and footwear that shields you from a real risk of injury or illness or protects your other clothes (such as steel-capped boots, hi-vis, sun-protection gear or aprons), and compulsory or registered non-compulsory uniforms unique to your employer.

Where the clothing is deductible, you can also claim the cost of laundering, drying and ironing it. A reasonable basis the ATO accepts is $1 per load if you wash only work clothing, or 50 cents per load if work clothing is mixed with other items. If your total laundry claim is $150 or less you do not need written evidence, though you still need a record showing how you worked it out.

Be careful here: clothing and laundry is one of the areas the ATO scrutinises most closely each tax time, so only claim clothing that genuinely meets one of the eligible categories above.

Self-education expenses are deductible when the course has a sufficient connection to your current job, meaning it maintains or improves the skills you use now, or is likely to increase your income from your current employment. You cannot claim a course designed to get you into a new field or a different occupation. Eligible costs can include course fees (where you pay them yourself and not through a HELP loan), textbooks, stationery, and some travel. Importantly, the old rule that reduced your self-education claim by $250 was removed for expenses incurred from 1 July 2022 onwards, so you can now claim all your allowable expenses.

Union fees and subscriptions to a professional body directly related to your work are generally deductible in full. Where a subscription to a trade, business or professional association does not directly relate to earning your employment income, the deduction is capped at $42 per association per year.

Other commonly overlooked deductions include income protection insurance premiums (but not premiums for life, trauma or critical-care cover), work-related portions of phone and internet not already in the WFH rate, and donations of $2 or more to a deductible gift recipient (DGR).

Here are some other work-related items that are frequently deductible when they relate directly to your job:

• Professional and trade journals, technical books and subscriptions used for work
• Seminars, conferences and short training courses connected to your current role
• Overtime meal expenses where you received a genuine overtime meal allowance under an award
• Tools insurance and repairs for equipment you use for work
• Agency commissions and licence or registration renewals required for your occupation

Good records are what stand between a legitimate claim and a denied one if the ATO asks questions. As a rule, keep your written evidence for five years from the date you lodge the return that includes the claim.

If your total work-related expenses come to $300 or less, you do not need receipts, but you still need a record showing how you worked the amount out. Note this $300 is a single threshold for your total work claims, not a free $300 deduction you can claim without spending the money. If your total goes over $300, you need written evidence for the whole amount, not just the part above $300.

Some claims have their own rules that sit outside the $300 threshold. Car expenses, travel allowance and overtime meal allowance claims have separate substantiation requirements, and working-from-home claims require the hours record and bills described earlier.

Receipts, invoices, bank and card statements, diaries, logbooks and the ATO's myDeductions tool in the ATO app are all valid ways to keep records. The cleaner your records, the faster and safer your return.

You can claim a deduction for the cost of managing your own tax affairs. This includes the fee you pay a registered tax agent or accountant to prepare and lodge your return, the cost of tax-return software, and travel to get tax advice from a recognised adviser. You claim it in the year you pay it, so this year's agent fee is generally a deduction on next year's return.

For the fee to be deductible, the adviser must be appropriately recognised: a tax agent registered with the Tax Practitioners Board (TPB), a qualified tax relevant provider registered with ASIC, or a legal practitioner. You can verify that a tax agent is currently registered using the free public register at tpb.gov.au, which is a sensible check before you hand over your information.

Other deductible tax-management costs can include certain litigation costs relating to your tax affairs, ATO general interest charge in some cases, and the portion of a financial advice fee that relates to managing your tax. If advice or software covers both tax and non-tax purposes, only the tax-related portion is deductible.

Because fees, rates and thresholds in this guide are reviewed regularly by the ATO and can be indexed or changed each year, always confirm the current figures at ato.gov.au, or ask a registered tax agent, before you lodge.