Your vehicle is not considered to be a car by the ATO if it has a carrying capacity of one tonne or more between home and work are private in nature and If the tools cost $300 or less – you can claim can’t be claimed. This applies even though he lives an immediate deduction for the whole cost. a long way from his usual workplace. While Paul If the tools cost more than $300, you can claim a can claim his site-to-site trips, he has chosen to live deduction for the cost over a number of years. away from work, so his travel from the ocean to the For more information go to city is not tax deductible. www.ato.gov.au/toolsandequipment Craig’s home to work travel is deductible. This is because he is required by his employer to carry Clothing expenses bulky tools or equipment for work, and he meets Paul and Craig’s employers require them to wear the following requirements: protective clothing (eg hi-vis vests and steel-capped • the equipment is essential to earning his income boots) so they can claim a deduction for these • there is no secure area to store the equipment expenses. But as their other clothing is not distinctive If Craig goes to the at the work location to their jobs (eg jeans) they can’t claim a deduction rugby on one of his • the equipment is bulky – at least 20kg – for this everyday clothing, even if their employer tells overnight Sydney trips and difficult to transport. them to wear it or they only wear it for work. he cannot claim this as To claim these car expenses employees must: a deduction because • keep a logbook of their work trips, or Travel expenses • be able to show their claim is reasonable Since Craig is required to travel away from home it is not related to if they use the cents per kilometre method overnight for work, he can claim a deduction for his income-earning (for claims up to 5,000 km only). accommodation and meal expenses. Craig can activities For more information go to only claim these expenses because he pays for www.ato.gov.au/carexpenses the accommodation and meals himself and is Your vehicle is not considered to be a car not reimbursed for the costs he incurred. If Craig if it is a vehicle with a carrying capacity of: receives a travel allowance from his employer he • one tonne or more, such as a ute or panel van must declare this as income in his tax return. • nine passengers or more, such as a minivan. On some of the overnight Sydney trips, Craig In these circumstances eg if you use a ute, you can goes to the rugby league with his colleagues to only claim your actual expenses such as fuel, oil, watch his beloved Sydney Roosters. Because this is insurance, repairs and servicing, car loan interest not related to Craig’s income-earning activities, he and registration. cannot claim this as a deduction. He will have to be You must keep all receipts for your actual satisfied with seeing his team in action. expenses, and cannot use the cents/kilometre Other common deductions method for your claim. There are other expenses Craig and Paul may be Tools and equipment expenses able to claim, including protective equipment such You can claim for tools and work equipment that as sunscreen, sunhats and sunglasses, union fees you need to buy for the job. But because Craig’s or phone expenses for work. tools use is 25 per cent for private purposes, he The information was provided by the can’t claim a deduction for that use. He can only Australian Tax Oce. For more details visit deduct 75 per cent of the cost. www.ato.gov.au/otherdeductions 92 HOUSING MAY 2018 BUSINESS • TAX TIPS