This is a useful guide for Apprentices across Australia relating to where you stand on tax. Please use it as a guide only, if you are unsure then speak to an accountant or the ATO.
Our first piece of guidance is:
Include all your income on your tax return – including cash!
You can claim a deduction for expenses that you have had as an apprentice if:
- you have spent the money yourself and it hasn’t been refunded to you
- it is directly related to you being able to do your work and earning your income
- you have a record to prove it such as a receipt or an invoice.
**** You can claim a deduction for expenses ***
In some instances, your employer may pay for your apprenticeship course fees outright. If this is the case or he reimburses you upon completion of your course, you cannot claim them as a deduction.
You can claim a deduction for work-related self-education expenses. This is where there is a correlation to your current work activities. This includes your apprenticeship course. You can also claim a deduction for the cost of travel from your home to your place of education and back. It is also okay to claim for your workplace to your place of education and back. You must keep records of your travel expenses to claim a deduction. Transport tickets or receipts will do this well.
Tools and equipment expenses
You are able to claim a deduction for equipment or tools that you buy and use for your job.
This is where a tool or item of work equipment you used for work:
- if the equipment or tool cost more than $300, you can claim a deduction for the cost over a number of years
- if it cost $300 or less then you can claim an immediate deduction. This would be for the whole amount.
- If you use the tools or equipment for both private purposes and work-related purposes, you can’t claim a deduction for your private use. So that means that if you have a toolset that you use for private purposes half of the time, you can only deduct 50% of the cost.
- If the tools or equipment Have been supplied to you rather than you purchasing, then this is a different scenario. If your employer or another person has bought them for you then you can’t claim a deduction.
There are some instances where, as an apprentice that you can claim a deduction.
- the cost of buying, mending and cleaning uniforms that are unique and distinctive to your job. This is where a uniform is required by your employer as part of your apprenticeship.
- protective clothing your employer requires you to wear for you to safely do your job. This includes hi-vis vests, steel-capped boots, safety glasses etc.
You can’t claim a deduction for plain clothing worn at work. That applies even if your employer tells you to wear it or you only wear it for work. An example would be workwear or tradie wear that is not designed to provide you with the amount of protection that is needed. If it does not adequately protect you from the risk of injury at your work site it will not qualify for a tax deduction.
As an apprentice, you can claim a deduction for the cost of using your own car while performing your duties. This can include travel between different work locations. Claims can also be made can be for different employers.
You generally can’t claim the cost of trips between home and work. This is the case even where you live a long way from your usual workplace. It is also where you may have to work outside normal business hours. There are limited circumstances where you can claim the cost of trips between home and work. Speak to your accountant or the ATO but these include examples where you carry bulky tools or equipment for work. The cost of these trips is deductible only if:
- your employer expects you to transport the equipment for work
- the equipment necessary for you to earn your income
- there was no secure area to store the equipment at the work location meaning it needed to be removed, and
- the equipment is bulky. It would need to be at least 20kg or cumbersome to transport.
If you claim car expenses, you must:
- keep a logbook of your work trips, or
- be able to show us your claim is reasonable if you use the cents per kilometre method.
- This only applies to claims of up to 5,000 km only.
Your vehicle is not considered to be a car if it is a vehicle with a carrying capacity of:
- one tonne or more such as a ute or panel van
- nine passengers or more such as a minivan.
- If you drive one of these vehicles you must keep all of your receipts and claim the actual expenses that relate to work. So these expenses would include such things as fuel, insurance, servicing costs, registration and depreciation. A logbook or similar will assist you to determine your work-related usage. You cannot use the cents per kilometre method for these vehicles.
Other common deductible expenses
Other work-related expenses you can claim include:
- protective equipment such as sunscreen, sunhats and sunglasses
- union and professional association fees
- phone expenses related to phone calls or texts you have to send for work.
Again, please be aware this is to be used only for guidance and you should seek clarification from your accountant, bookkeeper or the ATO. You can use the ATO app’s myDeductions tool to keep track of your expenses as you go: ato.gov.au/mydeductions