What Can I Claim on Tax? Work-Related Deductions in Australia

The ATO's three golden rules for work deductions

To claim a deduction for a work-related expense, the ATO says:

• You must have spent the money yourself and not been reimbursed. If your employer pays or reimburses the cost, you cannot claim it, and the ATO may check with your employer.
• The expense must directly relate to earning your income. There must be a close connection between the cost and your duties; being asked to buy something by your employer does not make it automatically deductible.
• You must have a record to prove it, usually a receipt.

What you cannot claim

Expenses that are private, domestic or capital in nature are not deductible. The ATO's examples are normal travel between home and work and buying lunch each day. If something is used for both work and private purposes, such as a phone or laptop, you can claim only the work-related share, and you need a record showing how you worked that share out.

Common work-related deductions and the rules that apply

The ATO groups employee deductions into the categories below. Each has its own test for whether the cost directly relates to your work, so the same item can be deductible in one job and private in another.

Work from home tax write-offs: the 70 cents per hour method

For 2025–26 (and 2024–25) the ATO's fixed rate is 70 cents for each hour you work from home. It covers home and mobile internet and data, phone usage, electricity and gas for heating, cooling and lighting, and stationery and computer consumables. You cannot claim those costs separately as well. You can still claim depreciation on desks, chairs, computers and similar equipment, and items costing $300 or less can be claimed in full in the year you buy them. As at 4 October 2026 the ATO's fixed rate page lists rates only up to 2025–26; no 2026–27 rate had been published.

Worked example: Mia works from home 2 days a week, 7.5 hours a day, for 46 weeks, which is 690 hours. Her fixed-rate claim is 690 × 70c = $483 (the ATO tells you to disregard cents, not round them). If she also bought a $249 desk lamp and keyboard set used only for work, she adds that, because it cost $300 or less.

Records are where most claims fail. You need a record of the actual hours worked from home for the whole year (timesheets, a roster, diary or calendar entries made at the time), plus at least one bill for each running expense the rate covers, such as one quarterly electricity bill. The ATO does not accept estimates. In its own example, an employee who estimated her hours for July to February could claim only the 136 hours she had recorded from March onwards.

The alternative actual cost method lets you claim the real work-related share of each expense instead, but needs more detailed records. The ATO says that only in limited circumstances, where you have a dedicated home office, can you also claim occupancy expenses such as rent or mortgage interest.

The $1,000 standard deduction from 2026–27

From the 2026–27 income year, eligible people get a standard deduction (also called the instant tax deduction) of up to $1,000 for work-related expenses without having spent the money or kept records. It does not apply to 2025–26 returns being lodged now. You are eligible if you are an Australian resident individual with "assessable labour income": salary and wages, director fees, termination and retirement payments, parental leave pay and similar. The ATO applies it automatically.

The standard deduction is reduced dollar for dollar by the work-related expenses you claim that it covers, including stationery, tolls, uniform, laundry, working from home, car expenses and travel between workplaces. In the ATO's example, an employee with $550 of expenses can either claim nothing and receive the full $1,000, or claim $550 (with records) and receive a $450 standard deduction. The total is the same, so not claiming is simpler. Someone with $3,500 of expenses claims them in full and gets no standard deduction. For an employee earning $60,000 in 2026–27, the full $1,000 is worth about $335 at a 33.5% marginal rate including Medicare levy.

Union fees, professional association memberships, donations, tax agent fees, income protection premiums, personal super contributions and investment expenses do not reduce the standard deduction. Claim them as usual.

Records you need to keep (and what changes on 1 July 2026)

Written evidence must show the supplier's name, the cost, what was bought, the date you paid and the date of the document. You also need a note of how you worked out the claim and the work-use percentage. The ATO says a bank or credit card statement on its own is not written evidence. Keep records for 5 years from the date you lodge, or 5 years from your last depreciation claim for an asset.

For 2025–26 returns, two shortcuts still apply. If your total work-related claim is $300 or less (excluding car, meal allowance, award transport and travel allowance expenses), you can claim without full receipts provided you can show you spent the money and how you calculated it. Laundry claims of $150 or less can also be made without receipts. From 1 July 2026 both exceptions, and the award transport payment exemption, are removed. If you claim more than your standard deduction in 2026–27, you need written evidence for every work-related expense. For laundry the ATO will still accept $1 a load when the load is work clothes only, or 50c when other clothes are mixed in, but without the $150 no-receipt limit.

The ATO app's myDeductions tool stores receipts, car trips and work-from-home hours and can upload them to myTax or share them with your tax agent.

What a deduction is actually worth

A deduction reduces taxable income, not your tax dollar for dollar. At $85,000 in 2025–26, each extra dollar is taxed at 32% including the Medicare levy, so a $1,000 deduction saves about $320. Below $18,200, a deduction saves nothing. Claiming something you are not entitled to risks the ATO disallowing it on review, plus penalties and interest.

• Claiming the whole cost of a phone or internet plan that is mostly personal.
• Claiming normal travel between home and your usual workplace.
• Estimating working-from-home hours instead of recording them.
• Claiming expenses your employer reimbursed, or that were covered by an allowance you did not spend.