Property owners urged to get deductions right, ATO

In a press release issued on August 16, the ATO said a taxpayer claimed "self-education" expenses for the cost of leasing a residential property, which was not his main residence.

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The Australian Tax Office (ATO) says despite repeated warnings that it will crack down on rental deductions at tax time, it’s still receiving “dodgy” claims.

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Photo: iStock/elenaleonova

In a press release issued on August 16, the ATO said a taxpayer claimed “self-education” expenses for the cost of leasing a residential property, which was not his main residence.

“The taxpayer claimed he had to incur the expense of renting the property as he ‘required peace and quiet for uninterrupted study which he could not have in his own home’. This was not deductible.”

The ATO said that in addition to the rental expenses, the cost of a storage facility was claimed where ‘the taxpayer needed to store his books and study materials’.

They claimed they needed this because of the huge amount of books and study material associated with his course and had no space in his private or rented residence where these could be housed. This was not deductible.

The cost of renting the property was around $57,000, with additional expense of $7,500 for the storage facility. The actual cost of the study program he attended that year was only $1200.

With over eight million Australians claiming work-related expenses each year, Assistant Commissioner Graham Whyte reminded people to make sure they get their deductions right this tax time.

“Australians claim over $21 billion in work-related expenses each year, and we want to support taxpayers to claim what they are entitled to – no more, no less,” Mr Whyte said.

“Most Australians want to do the right thing, but we are seeing mistakes, and while the amounts at an individual level are relatively small, collectively the overall impact is significant. That’s why, it is important for people to get their deductions right.

“From time to time we see people deliberately making incorrect claims. We’ve seen claims for car expenses where log books have been made up and claims for self-education expenses where invoices were supplied for conferences that the taxpayer never attended.

  • For information on work related expenses, visit ato.gov.au/deductions
  • For guides on deductions for specific industries and occupations, visit ato.gov.au/occupations

 

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