The Ultimate Guide to Work-Related Tax Deductions

When lodging your individual tax return, claiming every deduction you are legally entitled to is the single most effective way to reduce your taxable income and boost your refund.

To help you get the most out of your tax return, we’ve broken down the most common tax deductions available to Australian taxpayers—from work-from-home expenses to superannuation contributions.

The ATO Golden Rules for Claiming Deductions

Before claiming any expense, ensure it satisfies the Australian Taxation Office (ATO) three basic rules:

1. You spent the money yourself and were not reimbursed by your employer.
2. The expense directly relates to earning your income.
3. You have a record to prove it (receipts, invoices, or bank statements).

Pro Tip: If an item is used for both work and personal purposes, you can only claim the work-related percentage.

Motor Vehicle Expenses

For an Australian individual tax return, motor vehicle expenses depend mainly on whether the vehicle is used for work/income-producing travel and which method you use to calculate the deduction.

Logbook method

If you use the logbook method, you can generally claim the work-related percentage of eligible vehicle costs, such as:

• Fuel
• Tyres and batteries
• Repairs and maintenance
• Insurance
• Servicing
• Registration (rego)
• CTP
• Depreciation
• Interest on a car loan, where the borrowing relates to the vehicle and the relevant tax rules are satisfied
• Certain other vehicle running costs
• NRMA - If NRMA charges relate to vehicle insurance, roadside assistance or other vehicle costs, the deductibility depends on what the particular payment was for and whether the vehicle is used for income-producing purposes.

You generally need a valid logbook, odometer records and receipts/evidence for expenses.

Cents-per-kilometre method

Instead of calculating individual costs, you may be able to use the ATO's cents-per-kilometre method. This gives a set rate for eligible work-related kilometres, subject to the applicable annual kilometre limit. 

The Australian Taxation Office (ATO) cents per kilometre rate is 88 cents per kilometre for the 2025–26 income year, moving to 91 cents per kilometre for the 2026–27 income year.

If you use this method, you don't separately claim fuel, tyres, repairs, insurance, depreciation, registration, etc. for those same kilometres.

Work trips

Potentially deductible work-related trips can include travel between separate workplaces or other eligible work-related destinations.

However, ordinary travel from home to your regular workplace is generally private and isn't deductible, even if you carry work equipment, unless an exception applies.

Important: You generally choose either the logbook method or cents-per-kilometre method for the same car, rather than claiming the same vehicle expenses under both methods.

Travel Expenses

For an Australian individual tax return, travel expenses are generally deductible when the travel is directly related to earning your assessable income and isn't private travel.

Tolls

• Work-related tolls can generally be deductible where the underlying trip is deductible.
• Keep receipts or electronic toll records.
• If the toll relates to ordinary home-to-work commuting, it is generally private.

Motorcycles

• Work-related motorcycle travel may be deductible.
• You generally need to calculate the deduction using the applicable method and keep appropriate records.
• Running costs such as fuel, registration, insurance and repairs may be relevant depending on the method used.

Borrowed car

• If you use a borrowed vehicle for deductible work-related travel, the treatment depends on the circumstances and the particular expense.
• You generally can't claim expenses that you did not actually incur.
• Keep evidence of the work-related travel and any costs you personally paid.

Flights

• Work-related airfares can generally be deductible when the travel is for an income-producing purpose.
• Private portions of a trip generally aren't deductible.
• Keep the itinerary, receipts and evidence of the work purpose.

Accommodation

• Accommodation can generally be deductible when you travel away from home for work and incur the accommodation expense yourself.
• Private accommodation or the private portion of a mixed-purpose trip generally isn't deductible.

Interstate meals

• Meals while travelling interstate for work can potentially be deductible when the travel itself is deductible.
• Domestic travel allowance: If your employer pays a travel allowance, special substantiation rules may apply if you meet the relevant ATO conditions.
• You generally cannot simply claim a meal because you were away from home; the travel must have the required income-producing connection.

Key distinction

For 2026, the exact rules and rates can differ depending on whether you're an employee, contractor, or business operator and whether your employer paid an allowance.

Work-Related Clothing

For an Australian individual tax return, work-related clothing expenses are generally deductible only when the clothing meets the ATO requirements.

Potentially deductible

• Uniforms: A compulsory, distinctive work uniform can generally be deductible. A registered occupational uniform may also qualify where the relevant requirements are met.
• Safety boots: Generally deductible if they are protective footwear required for your work and you paid for them yourself.
• Protective glasses: Generally deductible where they provide protection required for your work.
• Occupation-specific clothing: Clothing that is distinctive to your occupation and not reasonably suitable for everyday wear can generally be deductible.
• Dry cleaning: May be deductible for eligible work-related clothing.
• Laundry: May be deductible for eligible work-related clothing, subject to the applicable substantiation rules.

Generally not deductible

• Ordinary suits, shirts, trousers, dresses or shoes worn to work, even if your employer requires you to dress professionally.
• Clothing that is suitable for everyday wear, even if you bought it specifically for work.
• Private clothing expenses.

Important

You can generally claim cleaning costs only where the underlying clothing itself is deductible. Keep receipts and records, particularly for larger expenses. If your employer reimburses you, you generally can't claim the same expense yourself.

Self-Education Expenses

For an Australian individual tax return, self-education expenses can generally be deductible when the study has the required connection to your current employment or income-producing activities.

Potentially deductible

• Course fees: May be deductible where the course maintains or improves skills/knowledge you use in your current income-producing activities, or is likely to increase your income from those activities.
• Textbooks: Work-related textbooks and required course materials may be deductible.
• Student union fees: Compulsory student union or similar fees can potentially be deductible where they relate to eligible self-education.
• Stationery: Items such as notebooks, pens and other supplies used for eligible study may be deductible.
• Depreciation: More expensive study-related equipment, such as a laptop or other depreciating asset, may be claimed through depreciation to the extent it is used for eligible self-education.

Generally not deductible

• A course that qualifies you to get a new job or enter a new profession, where there isn't a sufficient connection with your current income-producing activities.
• Private study expenses.
• The private portion of mixed-use expenses.

Important for 2026

Self-education deductions can involve specific rules about HECS-HELP/HELP payments, government support, scholarships and the first $250 of expenses. The treatment depends on the circumstances, so the expense shouldn't automatically be entered as a full deduction simply because it was education-related.

Work-Related Expenses

For an Australian individual tax return, these work-related expenses may be deductible where you paid them yourself, they relate directly to earning your assessable income, and the expense isn't private.

Potentially deductible

• Union fees: Compulsory or relevant union/professional association fees can generally be deductible.
• CPD / seminars: Work-related CPD courses, seminars, conferences and workshops can generally be deductible where they maintain or improve skills or knowledge relevant to your current work.
• Tools: Work-related tools and equipment can generally be deductible. Lower-cost items may be immediately deductible, while more expensive assets may need to be depreciated.
• Mobile phone: The work-related portion of your phone and phone plan may be deductible. You generally need to determine the work-use percentage and keep appropriate records.
• Subscriptions: Work-related professional publications, journals, software subscriptions and similar services may be deductible where they have a direct connection to your income-producing activities.
• Depreciation: Equipment and other depreciating assets used for work may generally be claimed over their effective life, based on the work-related percentage.

Generally not deductible

• Private or personal expenses.
• Expenses paid or reimbursed by your employer.
• Professional memberships or subscriptions with no sufficient connection to your current income-producing activities.
• The private portion of a mixed-use expense.

Records

Keep receipts/invoices, payment records and evidence of work use. For items such as a mobile phone, maintaining a reasonable record of work versus private use is particularly important.

For 2026, the treatment can also depend on whether you're an employee, contractor or running a business, and whether an item is a low-cost asset or needs to be depreciated.

Work-From-Home Deductions

For an Australian individual tax return, work-from-home (WFH) expenses can generally be claimed when you work from home to perform your employment duties and the expense meets the ATO's deduction requirements.

Fixed-rate method

For 2026, the ATO fixed-rate method is 70 cents per work hour. The rate covers certain running expenses, including:

• Electricity and gas
• Internet
• Mobile and home phone usage
• Stationery and computer consumables

You can generally claim the fixed rate for eligible WFH hours without separately claiming those covered running expenses.

You can still potentially claim separately identifiable expenses that aren't included in the fixed rate, such as depreciation on eligible office equipment.

You need appropriate records of your hours worked from home and evidence that you incurred the relevant expenses.

Actual-cost method

Under the actual-cost method, you calculate the actual additional cost you incurred from working at home.

This can include the work-related portion of:

• Electricity and gas
• Internet
• Phone
• Other eligible running expenses

For mixed private/work expenses, you need to calculate the work-related portion rather than claiming the entire bill.

Home office equipment

Items such as a computer, monitor, desk or office equipment may be deductible to the extent they are used for work.

• Lower-cost eligible items may potentially be immediately deductible.
• More expensive depreciating assets generally need to be claimed over time.
• If an item has both private and work use, only the work-related portion is generally deductible.

Important distinction

The 70c/hour fixed rate and actual-cost method are alternative methods for calculating eligible running expenses. You shouldn't claim the same expense twice.

Also, rent, mortgage interest, rates and other occupancy expenses have separate rules and generally aren't automatically deductible merely because you work from home as an employee.

Donations

For an Australian individual tax return, donations can be deductible when they meet the ATO's requirements.

Donations and charity gifts

• Charity gifts: A donation of $2 or more may be deductible if it is made to an organisation that is an eligible Deductible Gift Recipient (DGR).
• DGR status: Check that the recipient had DGR endorsement at the time of the donation. Not every charity or not-for-profit organisation is a DGR.
• Tax deductible: You generally need to have made a genuine gift and not received a material benefit in return. For example, buying merchandise or receiving something of value in exchange for your payment can change the tax treatment.
• Records: Keep the donation receipt. For certain donations, additional rules apply, such as donations of property or gifts made under special arrangements.

PAYG-deducted donations

If you asked your employer to make regular donations from your salary before PAYG tax is calculated, this can be treated differently from making a donation personally.

In some circumstances, your employer may reduce the amount of PAYG withholding rather than you claiming the donation as a deduction again in your tax return. Don't claim the same donation twice.

Quick guide

For a 2026 Australian tax return, the safest check is the ATO's DGR register and your donation receipt before entering the amount.

Investment Expenses

For an Australian individual tax return, investment-related expenses can sometimes be deductible when they relate to earning assessable investment income.

• Financial adviser fees: Fees for investment advice may be deductible to the extent they relate to managing investments that produce assessable income. Fees relating to establishing an investment or private financial planning are generally treated differently.
• Interest expenses: Interest on money borrowed to acquire income-producing investments may be deductible, subject to the purpose and use of the borrowed funds. Private-use interest generally isn't deductible.
• Investment management costs: Certain ongoing management or administration expenses associated with income-producing investments may be deductible.
• Portfolio deductions: Expenses connected with managing an investment portfolio can potentially be claimed where they satisfy the tax deduction rules. Some costs may instead form part of the investment's cost base rather than being immediately deductible.
• Records: Keep invoices, statements and evidence showing the investment connection and, for borrowing, how the borrowed funds were used.

The key distinction is usually ongoing expenses incurred in earning investment income vs. capital or private expenses.

Tax Agent Fees

For an Australian individual tax return for 2026, these items can be treated as follows:

• Tax lodgement costs: Fees paid to a tax agent to prepare and lodge your tax return are generally deductible. The deduction is usually claimed in the income year in which you incur the fee, not necessarily the year the return relates to.
• Tax advice fees: Tax advice is generally deductible to the extent it relates to your income-producing activities or tax affairs. Advice relating purely to private matters generally isn't deductible.
• Motor vehicle kilometres to your tax agent: Travel to your tax agent can potentially be deductible where the trip is sufficiently connected with your income-producing activities. If eligible, you need appropriate records of the kilometres and purpose of the trip. Ordinary private travel isn't deductible.
• ATO interest charges — 2026: General Interest Charge (GIC) and Shortfall Interest Charge (SIC) are generally not deductible for an individual taxpayer where they relate to your personal income tax liabilities. They should not simply be included as a tax-agent expense.

Quick guide

Important: A tax-agent fee itself is different from ATO interest charged on an outstanding tax debt. The former can generally be claimed; the latter generally cannot.

Personal Super Contributions Deduction

For an Australian individual tax return for 2026, personal super contributions can potentially be claimed as a tax deduction, but there are several important conditions.

Personal/voluntary contributions

• Voluntary personal contributions: If you make additional contributions to your super fund from your own money, you may be able to claim them as a personal super contribution deduction.
• The contribution must be made to a complying super fund/RSA and you must satisfy the relevant work and age requirements.
• A contribution you claim as a deduction becomes a concessional contribution and counts toward your concessional contributions cap.

Notice of Intent to Deduct Personal Super Contributions

This is particularly important.

To claim the deduction, you generally must:

1. Lodge a valid Notice of Intent (NOI) with your super fund.
2. Have the fund acknowledge the notice.
3. Claim only the amount that the fund has acknowledged as deductible.

For a 2026 return, the NOI generally needs to be lodged by the earlier of the day you lodge your 2026 tax return or 30 June 2026.

If the fund has not acknowledged a valid NOI, you aren't entitled to claim the deduction.

Carry-forward unused contributions — 5 years

If you have unused concessional contribution cap amounts from previous years, you may be able to use them to make additional deductible personal contributions.

For the carry-forward rule, you generally need:

• A total super balance of less than $500,000 at 30 June of the previous financial year, and
• Unused concessional cap amounts from the previous 5 financial years.

Unused amounts expire after five years. For example, unused amounts from 2019–20 that weren't used by the end of 2024–25 expired.

You can check your available carry-forward amounts through ATO online services → Super → Information → Carry forward concessional contributions.

Quick guide

One important point: the carry-forward rule doesn't mean you can automatically deduct five years' worth of contributions. Your actual available amount depends on your contribution history and the unused cap shown by the ATO.

Other Deductions

For an Australian individual tax return for 2026, these “Other Deductions” need to be separated carefully because carried-forward tax losses are not simply another expense deduction.

Income Protection Insurance

• Premiums you personally paid for income protection insurance can generally be deductible if the policy protects you against loss of income.
• If the policy also covers things such as physical injury, life, trauma or critical illness, the premium may not be fully deductible; the deductible component needs to be determined.
• If premiums are paid from your super fund, you generally can't claim them as a personal deduction.
• If you subsequently receive income-protection payments, those payments generally need to be included in your assessable income.

Foreign Exchange Losses

• A forex loss can potentially be deductible where it falls within the relevant Australian forex tax rules and is connected with assessable income.
• Forex losses are generally recognised when the relevant foreign-currency right or obligation is realised, rather than simply because an exchange rate moved on paper.
• Private/domestic forex losses and certain losses connected with capital assets or exempt income aren't generally deductible.
• If the forex activity is part of a business, the treatment can instead be incorporated into the business income/loss calculation.

Carried-Forward Tax Losses

This is different from an ordinary deduction.

• A tax loss from an earlier income year may potentially be carried forward and deducted against later eligible income.
• You don't normally enter the old loss as a new expense in the year it is being carried forward.
• The amount available should generally come from the tax-loss records in your previous returns/ATO records.
• Capital losses are different: they are generally carried forward to offset future capital gains, rather than being deducted against ordinary salary/wage income.

Quick guide

The ATO's 2026 myTax guidance specifically includes income-protection premiums and foreign exchange losses under “Other deductions.”

Disclaimer: This article provides general information only and does not constitute formal tax, financial, or legal advice. Tax laws in Australia are complex and subject to legislative change. You should consult a Registered Tax Agent to obtain advice tailored to your specific circumstances before taking action.