If you are getting ready to lodge your tax, you may be wondering what you can claim as a deduction. By claiming deductions, you can help reduce your taxable income and boost your tax refund (if eligible). But before you begin claiming everything and anything, it’s important to understand what is considered to be acceptable deductions, otherwise you could risk auditing and legal action from the Australian Taxation Office (ATO). Tuff-As explains what you can claim on tax as a tradesperson as well as providing some handy examples from our product range.
What can tradies claim on tax?
When it comes to claiming a deduction for a work expense, you need to meet the three golden rules of the Australian Taxation Office (ATO):
- You must have spent the money and have not been reimbursed
- The expense is directly related to you earning your income
- You have a record to prove it (such as a hardcopy or digital receipt).
For the majority of tradespeople, you will find that you can claim workwear, tools and equipment, some vehicle expenses, and upskilling and education expenses.
Types of workwear you claim
Most clothing cannot be deduced as a work expense on tax as it is considered to be worn by people regardless of their occupation. Casual clothing, such as a flannelette shirt or jeans, can’t be claimed - even if you do wear it to work.
You can claim the cost of purchasing, hiring, cleaning, and repairing your workwear if it falls within the following categories.
Protective clothing helps to protect workers against illness and injury within the workplace, and is part of Personal Protective Equipment (PPE). You can claim clothing as deductions which helps protect you while on the job, such as the FXD WP-1 Original Work Pant which features protective knee pads.
As Hi-Vis clothing falls under the umbrella of protective clothing and is required for many types of work, you can claim purchasing it on your tax. We recommend purchasing the JBS Hi-Vis Polar Vest and the JBS Hi-Vis Fleecy Crew as they will keep you warm during the winter months and meet relevant Australian safety standards so they can be claimed as deductions. As some hi-vis clothing has special care requirements, such as ‘dry clean only’, you can claim the cost of cleaning it. Just make sure to keep the receipts and a clear record.
If you’ve been thinking about purchasing a nice pair of non-safety boots to wear around the pub, unfortunately you won’t be able to claim them on tax. The ATO explicitly states that the only footwear which can be claimed as a deduction needs to protect you from the risks of injury at work, and uses the example of steel capped boots. We’d recommend purchasing the Steel Blue Argyle Zip Tpu Safety Boot or the FXD WB-2 Nitrolite Mid Cut Work Boots which are able to be claimed as deductions due to meeting safety standards.
As safety gear is an essential part of keeping you safe during the work day and is often a legal requirement, you can claim it on your tax as a deduction. Common examples of safety gear can include protective earmuffs, gloves like the Paramount Safety Prosense Black Panther Gloves, or the Paramount Hard Hat With Protective Earmuffs.
If you have clothing that your employer strictly and consistently enforces you to wear by workplace agreement or policy, and distinctly identifies you as an employee then you can claim this clothing as a deduction. An example of this may be purchasing a long sleeve shirt from your employer which has been especially embroidered or custom-printed with the details of your workplace.
Keep a record of your purchases
As with all tax administration, ensuring that you have the right documentation to claim your workwear deductions is essential. We recommend that you keep a copy of your receipt (especially if paying in cash), and keep an additional record with the purchase details, date and amount. For extra peace of mind, you can register your customer details with the team at Tuff-As so we have a record of your purchase. This can be highly convenient if you have mislaid a receipt and require proof of purchase to claim your Tuff-As workwear. Get in touch with us and our friendly team can assist you with setting up a customer profile.