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Tax deductible expenses : The essentials for employees

David Rynne - Thursday, August 01, 2013

Taxpayers must keep written evidence of their deductible expenses. What is written evidence?

1. a document from the supplier (eg: an invoice) which shows
  • name of the supplier
  • amount
  • nature of the expense
  • date of the expense
2. another document, or combination of documents, containing the above details, including:
  • bank statements
  • credit card statements
  • BPay references
  • emailed receipts
  • Your PAYG summary which may show expenses which have been deducted from salary.
3. Diary entry or similar for expenses of $10 or less where the total is < $200

A couple of important things to remember:
  • bank / credit card statements on their own are not sufficient to meet the ATO requirements.
  • there must always be a connection between the expense and income earned.
  • certain expenses may require apportionment for private use (eg: home internet, mobile phone)

Now, if you are after a sure fire way of tracking all your expenses, and your personal finances, take a look at Xero Touch. For just $60 a year (tax deductible), you can track income and expenses, set budgets and you can take photos of receipts. Think about it : you mislay or forget a few expenses, that will cost you real dollars.