The ATO areas of focus in relation to deductions in the 2014/15 year include:
• Work related use of electronic devices
• Overnight work related travel
• Rental property deductions
Work related use of electronic devices
The ATO flagged that it would target improper estimates of the usage of phones, computers and other electronic devices for work purposes. If audited the tax office will now be looking for some justification for your figure. It is recommended that you should keep a log book and record your business and personal usage over a 12 week period.
Overnight work related travel
Overnight work related travel claims have been a perennial concern for the ATO. The current focus for the ATO is on the building and construction industry. The ATO has specified that there are a lot of people claiming costs that they shouldn’t be claiming. If you are not paid a travel allowance by your employer you cannot claim expenses using standard formulas provided by the ATO. This means you will have to be able to substantiate the trip and the purpose of the trip as well as the expenses associated with that trip such as meals and accommodation.
Rental property deductions
The ATO has traditionally targeted repairs and maintenance expenses on rental properties, however the focus has now shifted to whether or not a rental property actually contains tenants to enable deductions to be claimed rather than the property being available to rent. (this article was featured in our June 2015 newsletter)