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Five expenses people forget about at tax-return time
Sadly, this doesn’t include the sort of pets celebrities carry in their handbags. Think working farm and business premises security dogs. Basically, if you use a dog for work purposes, you could claim expenses like pet food and vet bills. The acquisition and training costs of the dog itself, however, may be considered a depreciable asset of the business.
If you operate a business out of your home, you might be able to claim a proportional amount of your home insurance on house contents (depending on your circumstances). In other words, because you would use your home for both personal and business purposes, you can only claim for some of the costs to run your home. The Australian Taxation Office (ATO) says that you can claim occupancy expenses when your home is your principal workplace and you have a dedicated work area. Find out more from the ATO about home office expenses here.
Operating a business out of your home has different tax rules to working from home. For the latter, you can’t claim for things like insurance, but you should be able to claims for utilities, phone costs, and decline in value of office equipment. Read more about work from home tax incentives here.
Rental property costs
If you rent out a property, you can claim expenses relating to the property for the time it was rented or was available for rent. That includes things like landlord insurance premiums, cleaning, council rates, land tax, water charges, and advertising. Hopefully you never have to evict a tenant, but if you do, legal fees associated with this should be covered. Check out the full list from the ATO here.
Use your car for work, ride-sharing, or business? Then you may be able to make a tax deduction for your car insurance. But you can’t claim for simply getting to or from work – it has to be related to earning your income. If you use the log-book method, you can claim the work-related percentage of your car insurance as a deduction. The cents per kilometre method on the other hand incorporates all costs, so there is no separate deduction for car insurance if you use this method.
Mobile phone insurance
Under home office equipment, you may be able to make a tax deduction for your phone costs, proportional to your work-related usage. Phone plans can include insurance. There is no fixed rate for internet and phones, so you’ll need to calculate your actual expenses before you submit a claim.
AAMI can also offer insurance for mobile phones with Portable Valuables Cover, which is an optional extra available with AAMI Home and Contents insurance.
Make sure to do your research when it comes to making a tax return. You don’t want to claim for the wrong thing, but you’ll also want to avoid missing out on tax deductions you’re entitled to. Happy claiming!
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The information is intended to be of general nature only. We do not accept any legal responsibility for any loss incurred as a result of reliance upon it – please make your own enquiries.
AAMI Car, Home and Contents Insurance issued by AAI Limited ABN 48 005 297 807 trading as AAMI. Read the Product Disclosure Statement before buying this insurance. Go to aami.com.au for a copy. This advice has been prepared without taking into account your particular objectives, financial situations or needs, so you should consider whether it is appropriate for you before acting on it.