What deductions can I claim in my tax return?
There are lots of rules around what can be claimed as a tax deduction for small business owners. Here are some basic guidelines to help with your next tax return.43
Tax time can be confusing for some of us, which is why many small business owners engage an accountant to help prepare their tax return. However, if you lodge your tax return yourself, there are basic rules for claiming deductions .
You’re entitled to claim tax deductions for some expenses that are directly related to earning your income.
Basic rules for claiming deductions include:
- Claim the deduction in the same year that you made the purchase. For the 2014 financial year, your purchase must have been bought anywhere between 1 July, 2013 to 30 June, 2014.
- Don’t claim an expense you that you have been, or will be reimbursed for.
- You can claim expenses incurred in earning your assessable (taxable) income but not private, domestic or capital expenses.
- Be sure to always keep written records. receipts and invoices.
Vehicle and travel expenses
You can claim vehicle and other travel expenses directly connected with your work but not for normal trips between home and work, which are considered private travel. For example, if you travel to and from work every day by train, you
cannot claim your train ticket. However, if one day you travelled by train to a different location to attend a work-related seminar, for example, you can claim the cost of your train ticket for that day.
If you carry out some of your work from a home office, you may be entitled to a deduction for the costs you incur in running the office, including:
"If you carry out some of your work from a home office, you may be entitled to a deduction for the costs you incur in running the office."
- Home-office equipment such as computers, printers and telephone;
- Work-related phone calls and phone rental.
Tools, equipment and other assets
You may be able to claim a deduction for tools and equipment used for work. The type of deduction you claim depends on the cost on the cost of the item. Items that cost $300 or less can be claimed immediately.
You can also claim other work-related expenses, such as the cost of reference books and union and professional association fees.
There is a range of deductions you may be able to claim, depending on your occupation. If you are lodging your tax return yourself, make sure you do your research to ensure you are getting the most out of your tax return. If you are unsure, it’s best to seek the advice of a professional.
Are you clear on what tax deductions you can claim?Source: www.flyingsolo.com.au