Are you a self-employed Tradesman or Contractor? Being self-employed can provide a lot of benefits, such as flexible working hours and being your own boss.
When it comes to your tax return, however, it can get a little complicated. Being a self-employed Tradesman or Contractor, you may have more tax responsibilities and liabilities to consider. These could include reporting your income and work expenses, and keeping proper business records. The best way to be prepared for the Tax Season, is to remain organised throughout the year and seek the right tax advice and services when completing your tax return.
Complied below is a list of expenses that can be deductible for most self-employed Tradesmen or Contractors. The list details the standard and not so commonly known possible tax deductions that you may be able to claim in your tax return 2017. To be able to claim your work-related expenses, the item must have been required for your business or job. Also, it is essential that you keep well-organised and easily accessible records, such as receipts or invoices, in a paper or electronic system. If you don’t and the ATO questions your tax return claims, you may be heavily penalised and face a fine, as well as additional fees.
Please note, that this is not an exhaustive list and that you should always seek advice from your Accountant before making a claim.
Table 1: Tax Deductible Expenses List for Self-Employed Tradesmen and Contractors.
Work-related Expense |
Details |
Is it Tax Deductible? |
| Protective clothing | All protective clothing, including steel-capped boots, High-vis clothing, helmets, goggles, and so on. | Yes |
| Laundry | Laundry costs for all work-related clothing | Yes |
| Tools & Equipment | You can now claim up to $20,000 on business-related assets, between 12 May 2015 and 30 June 2017 | Yes |
| Repairs | Incurred on assets used for work | Yes |
| Transport | Work-related vehicle expenses, such as fuel and servicing, or public transport. If you use your vehicle for business and private reasons, you can only make a proportionate claim. | Yes |
| Education costs
|
Any educational course or related costs that are required for your current job or work enhancement |
Yes |
| Mobile Bills | Only work-related mobile phone costs can be included. If you use your mobile for business and private reasons, you can only make a proportionate claim. | Yes |
| Sun protection | Sunscreen, sun hat and sunglasses used during work | Yes |
| Home office
|
If a part or a room at home is used for work related activity, you may be able to claim a portion of the running expenses, such as rent, electricity and internet. |
Yes |
| Super contribution | Up to $ 25,000 per annum, paid after-tax income. | Yes |
| Stationery | Used for work or home office | Yes |
| Bank Charges | Only if the bank account generates interest income | Yes |
| Interest | Borrowed for work related financing, such as for assets or equipment | Yes |
| Tolls and Parking Fees | Incurred during work related travel | Yes |
| Trade union | Trade related association body expenses, including annual practising | Yes |
| Association fees | Certificate costs | Yes |
| Technical publications | For the line of work | Yes |
| Tax/Accountancy fees | Tax, BAS and Accounts preparation ( plus travel cost to meet) | Yes |
| Public liability | If required to carry out work | Yes |
| Legal expenses | For work related contracts | Yes |
| Insurance | Income continuance, sickness and accident | Yes |
| Meals | Routine meals during work and travel | No |
| Meals | If you worked after normal hours and overnight travel | Yes |
| Fines | Imposed by court or law | No |
| Entertainment | Personal entertainment, such as drinking or dining out with friends | No |
| Conventional Clothing | Not related to work | No |
| Driver’s license | Renewal and acquiring fees | No |
| Club membership | Such as Social Club fees | No |
| Child care expenses | Child support expenses | No |
| Other | Any other costs incurred to generate work income | Most often – Yes |
First published: https://www.mastax.com.au/tax-deductions-for-tradies-and-contractors-tax-accountants-dingley-village/