TL;DR – What You Need to Know
- You can only claim expenses that are directly related to earning your income, that you paid for yourself, and that you have records for.
- If something has both work and private use (phone, internet, etc.), you can only claim the work-related portion.
- Keep good records — the ATO expects evidence, especially for phone, internet, and home office claims.
- The new $1,000 standard deduction does not apply to your 2026 return.
- Our checklist will help you identify what you can claim and prompt you for the right records.
👉 Complete the Growthwise 2026 Tax Return Checklist
---
Let's be upfront: Australian tax deductions for employees are not a free-for-all. The golden rule is simple, you can only claim something if you genuinely needed it for work, you paid for it yourself, and you have records to prove it.
The tricky part is when something crosses over between work and personal use. Your phone, internet, and home office costs are classic examples. You can only claim the work-related percentage, and the ATO expects you to be able to show how you calculated it.
Here's what you can and can't claim for the 2025–26 tax year.
The General Rule
If you had to buy it for your job, you can generally claim it. But if the same item also has private use, you can only claim the work-related portion.
Common items that need splitting:
- Phone and internet
- Home office expenses (see our Working from Home guide)
- Motor vehicle expenses (see our Motor Vehicle Expenses guide)
What You CAN Claim
Protective clothing and occupation-specific clothing
Hard hats, safety boots, hi-vis clothing, sunscreen, and sunglasses if required for your job and not supplied by your employer. You can also claim the cost of buying and laundering a genuine uniform (one with a logo or that is occupation-specific). Regular black pants and a white shirt don’t count just because you wear them to work.
Tools and equipment
Anything you need to do your job that your employer doesn’t provide. Items under $300 can usually be claimed in full. Items over $300 need to be depreciated over their effective life.
Example – Tools
A tradie buys a new $450 drill. Because it costs more than $300, they can’t claim the full amount in one year. Instead, they claim depreciation based on the drill’s effective life.
Work-related travel
Flights, accommodation, and meals when travelling for work (not your normal daily commute), provided your employer hasn’t already reimbursed you.
Phones and internet
The work-related portion. You'll need to work out what percentage of your use is for work vs personal. The ATO expects you to do a representative 4-week period of tracking and apply that percentage across the year.
Professional development
Courses, seminars, and training that maintain or improve your skills in your current job (not a career change). You can claim course fees, materials, and travel to attend.
Union fees and professional association memberships
If the union or association is relevant to your current work.
Journals, magazines and subscriptions
Only if there’s a clear work connection (e.g. a teacher subscribing to an education journal).
Parking
When visiting clients or work sites (not your regular work parking). AND assuming your employer has not reimbursed you.
Donations
Not a work related item but something that lots of people get wrong. Gifts to DGR-registered charities are deductible. Buying a raffle ticket or charity merchandise is not.
What You CANNOT Claim
- Your daily commute (home to work and back)
- Regular clothing that isn’t a genuine uniform or protective/occupation-specific
- Entertainment expenses
- Fines and penalties
- Social club fees
- Childcare costs
- Anything your employer has already paid for or reimbursed
- Coffee, milk, and snacks you’d normally have at work
Common Issues We See
The ATO pays close attention to employee claims. Common problems include:
- Claiming 100% of phone or internet without any records to support the work percentage
- Claiming clothing that isn’t a genuine uniform
- Not keeping receipts or records to substantiate claims
The ATO also data matches based on occupation codes. High expenses when compared to others in your occupation will certainly increase the likelihood of you being audited. Good record-keeping is the best protection.
Occupation-Specific Guides
The ATO publishes detailed guides for many occupations (teachers, nurses, construction workers, real estate agents, etc.). These are very useful and worth checking. You can find them on the ATO website here.
The $1,000 Standard Deduction (Coming in 2027)
From the 2027 tax return onwards, there will be a $1,000 standard deduction for work-related expenses. This does not apply to your 2026 return.
For 2026, you still need to claim your actual expenses with records. For most people with genuine work expenses, claiming actual deductions will still be better than taking the flat $1,000.
Remember this is not $1,000 back from the government, it's simply a $1,000 tax deduction.
Keeping Good Records
The easiest way is to use the ATO’s myDeductions app. You can also just photograph receipts and store them in a folder on your phone or in Google Drive/Dropbox.
If you’re ever asked by the ATO, you’ll need to be able to show that you both incurred the expense and paid for it. Keep records for at least five years.
---
Ready to get started?
👉 Complete the Growthwise 2026 Tax Return Checklist
It will walk you through your expenses and help make sure you have the right records.
Got questions? Check our FAQ page or send us a message.
