If you’re a construction worker it pays to learn what you can claim at tax time
To claim a deduction for work-related expenses
- you must have spent the money yourself and weren’t reimbursed
- it must be directly related to earning your income
- you must have a record to prove it.*
* You can use the ATO app myDeductions tool to keep track of your expenses and receipts throughout the year.
You can only claim the work-related part of expenses. You can’t claim a deduction for any part of the expense that relates to personal use.
- drive between separate jobs on the same day – eg from your job in construction to your second job as a security guard
- drive to and from an alternate workplace for the same employer on the same day – eg travelling between depots or worksites.
You generally can’t claim the cost of trips between home and work, even if you live a long way from your usual workplace or have to work outside normal business hours – eg weekend or early morning shifts.
There are limited circumstances where you can claim the cost of trips between home and work, such as where you carry bulky tools or equipment for work – eg a large extension ladder. The cost of these trips is deductible only if:
- your employer requires you to transport the equipment for work
- the equipment was essential to earning your income
- there was no secure area to store the equipment at the work location, and
- the equipment is bulky – at least 20kg or cumbersome to transport.
If you claim car expenses, you need to keep a logbook to determine the work-related percentage, or be able to demonstrate to the ATO a reasonable calculation if you use the cents per kilometre method to claim.
You can claim a deduction for the cost of buying, hiring, mending or cleaning certain uniforms that are unique and distinctive to your job – or the environment you work in – or protective clothing that your employer requires you to wear – eg steel-capped boots, high-vis vests, fire-resistant and sun-protection clothing.
You can’t claim a deduction for the cost of buying or cleaning plain clothing worn at work, even if you only wear it to work and even if your employer tells you to wear it – eg standard jeans, drill shirts and trousers.
You can claim a deduction for travel expenses if you are required to travel overnight and don’t attend your usual work location – eg travelling to a remote area, provided the cost was incurred while carrying out your work duties. This could include meals, accommodation, fares and incidental expenses that you incurred while carrying out your work duties and your employer has not provided or reimbursed you.*
* Circumstances may be different for FIFO workers.*
Receiving an allowance from your employer does not automatically entitle you to a deduction. You need to be able to show you were away overnight, you spent the money and the travel was directly related to earning your income.
Depreciation of tools and equipment expenses
You can claim a deduction for the cost of the purchase of tools and equipment you are required to use for work. You can’t claim a deduction relating to any private use of the equipment or if the tools and equipment are supplied by your employer or another person.
If a tool or item of work equipment only used for work:
- cost more than $300 – you claim a deduction for the cost over a number of years (depreciation)
- cost $300 or less – you can claim an immediate deduction for the whole cost.
You can claim a deduction for the cost of repairing tools and equipment for work. If the tools or equipment were also used for private purposes, you cannot claim a deduction for that part of the repair cost.
Other common deductible work-related expenses
- protective equipment such as sunglasses, sunhats and sunscreens
- safety equipment such as harnesses, goggles and breathing masks
- union fees.
You can’t claim a deduction if the cost was met or reimbursed by your employer.