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ATO cracks down on high work-related deductions

The ATO is closely scrutinising employees who make abnormally high work-related expense claims.

The tax office is using advanced data and technology to identify and investigate claims that stand out from the usual. They are repeatedly targeting people who claim a tax deduction for using their computer, phone or other electronic devices to perform duties, transport bulky tools and equipment, or travel between work and home.

If an employee has to use their computer, phone or other electronic devices for work purposes, they cannot claim a private usage portion. They must ensure they claim the correct amount and have evidence to validate their claim.

Employees usually can’t claim a deduction for travel between home and work unless they are transporting bulky tools and equipment. But there are certain rules that they must comply too. While overnight work-related travel is deductible, the ATO provides a reasonable travel allowance each year to cover the expenses for meals, accommodation and other incidental costs.

The ATO has provided three characteristics to help employees qualify a work-related expense claim:

– the claim must relate to the job.

– employees must have spent the money themselves.

– employees must have a record to prove it.

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