Overview

• The Australian Taxation Office (ATO) has revealed examples of denied tax deduction claims, including swimwear, air fryers, and luxury clothing, to deter non-compliance.
• One mechanic attempted to claim an air fryer, gaming console, and other household items as work-related expenses, while a truck driver tried to deduct swimwear for a highway stop swim.
• Chartered Accountants ANZ highlighted additional dubious claims, such as a luxury yacht and pilates equipment, emphasizing a trend of personal expenses being disguised as work-related.
• The ATO will focus on work-related and working-from-home deductions this year, using data analytics to identify exaggerated or mistaken claims, with penalties for non-compliance.
• Taxpayers are urged to ensure expenses directly relate to income-earning activities, are supported by records, and meet the ATO’s 'pub test' for eligibility.