The $1 tax rule that could get you in BIG trouble
As if tax time weren't complicated enough!
There's no other way to cut it, tax time sucks.
Like, really sucks.
Unfortunately, it's about to get a little more sucky with the Australian Tax Office (APO) cracking down on one of the most common tax expenses: laundry.
The ATO will be putting the expense under scrutiny with many categorising it as standard reduction which needs no receipt.
"Last year around 6 million people claimed work-related clothing and laundry expenses, with total claims adding up to nearly $1.8 billion," Assistant Commissioner Kath Anderson explained.
"While many of these claims will be legitimate, we don't think that half of all taxpayers would have been required to wear uniforms, protective clothing, or occupation-specific clothing."
Standard tax claims (under $150) involve a $1 per load claim for work-only washing cycles and .50 cents for those which also contain non-work related items.
"We know that some people think $150 is not a large amount and that nobody will notice if they over-claim," Anderson continued.
"But while $150 might not be big individually, when you multiply it over millions of taxpayers, it adds up to a lot. And besides, no matter how small, other Australians shouldn't be expected to wear your over-claiming."
There's good news for those who are scratching their heads at the whole thing; there is a way to tell what you can claim and what you can't.
According to Anderson, the best way to get your clothing and laundry claims right is to follow the three golden rules and only claim if:
1. You paid for it yourself and you weren’t reimbursed
2. You were required to wear a uniform that’s unique and distinct to your employer, protective or occupation specific clothing
3. And you’ve got a record that demonstrates how you calculated your claim.
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