Do you know what tax deductions and offsets you may be eligible for? The following tips may help you legitimately reduce your tax liability in your 2016-17 return.

Claim work-related deductions

Claiming all your work-related deduction entitlements may save considerable tax. Typical work-related expenses include employment-related telephone, mobile phone, internet usage, computer repairs, union fees and professional subscriptions.

Note that for the first time ever the ATO is checking these claims in real time.  Claim only what you are legally entitled to claim and ensure that you have all necessary receipts or credit card statements to back-up your claims.

Claim home office expenses

When part of your home has been set aside primarily or exclusively for the purpose of doing work a home office deduction may be allowable. Typical home office costs include heating, cooling, lighting costs, and even depreciation of your office equipment.

To claim the deduction you must have typically kept a diary for at least four weeks of the hours you worked at home.

Claim self-education expenses

Self-education expenses can be claimed provided the study is directly related to either maintaining or improving your current occupational skills or it is likely to increase your income from your current employment. If you obtain new qualifications in a different field through study, the expenses incurred are not tax deductible.

Typical self-education expenses include, course fees, textbooks, stationery, student union fees and the depreciation of assets such as computers, tablets and printers.

However, any Higher Education Loan Program (HELP) repayments are not deductible. You must also disallow $250 of self-education expenses, which can include non-deductible amounts such as child-care costs.

Claim depreciation

Immediate deductions can be claimed for assets that cost under $300 to the extent the asset is used for an income producing purpose. Such assets may include tools for tradespeople, calculators, briefcases, computer equipment and technical books purchased by an employee, or minor items of plant purchased by a landlord.

Maximise motor vehicle deductions

If you use your motor vehicle for work-related travel, there are now only two choices for how you can claim work related travel. If your annual claim for kilometres travelled does not exceed 5,000 kilometres, you can claim a deduction for your vehicle expenses on a cents per kilometre basis.  Such claims must be based on reasonable estimates.

If your business travel exceeds 5,000 kilometres, you must use the log book method to claim a deduction for your total car-running expenses.

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