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Which Receipts Should I Keep For Tax?

which-receipts-should-i-keep-for-tax

Looking to claim work related expenses in your income tax return this financial year? Great idea.

Unsure of which receipts you need to keep? You’ve come to the right place.

In this article we’ll take a look at a range of deductions which must be substantiated by a receipt. A receipt functions as the primary form of written evidence to support claims you make for tax deductions. If the expense was incurred inside Australia, the receipt must be in English. Further, a receipt from the supplier of the product or service must detail the following:

  1. The name of the supplier.
  2. The amount of the expense or purchase.
  3. The name, or nature of the goods or services purchased or the expense incurred.
  4. The date the expense was incurred.
  5. The date of the document.

You can find out more about what constitutes written evidence, and the sorts of documentation that you can provide if a receipt is unavailable here.

Receipts and Low Income

If your gross income this financial year totals less than $18,200 then you do not need to pay income tax. Thus, you may lodge a tax return and expect to receive a refund of any tax withheld from your income regardless of tax deductions claimed. In this instance, holding on to receipts is not strictly necessary for tax purposes, because you have no need to claim specific deductions.

However, as a general rule, we recommend holding on to the receipts you may require should you earn more than expected.

When is a Receipt Required to Claim a Tax Deduction?

Receipts and written evidence is not required should your total employment-related expense claims be equal to or less than $300.

Should you claim an amount over $300, you may be required to provide written evidence for each individual expense, not simply those that occur once the $300 threshold is exceeded. For example, should you claim expenses of $350, you must provide written evidence for the total amount, not just for the $50 you deem to be in excess.

We therefore believe that holding on to relevant receipts is best practice. It’s not always clear at the start of the financial year what your work related expenses might be. Better to be prepared. It’s also strongly recommended that you retain records of your claimed expenses for 5 years.

Examples of Expense Claims

Below is a list of common claim expense claims where receipts should be maintained to substantiate any claims.

  • Clothing, dry-cleaning and laundry expenses to maintain eligible protective clothing and uniforms. Up to $150 may be claimed without written evidence, providing that your total work related expense claim does not exceed $300.
  • Claims for the depreciation of equipment used for business purposes.
  • Travel claims for airfares , accommodation, taxis etc
  • Subscriptions and Union fees
  • Income protection insurance premiums
  • Printing and stationery expenses.
  • Donations made to eligible charities.
  • Home office expenses. You may claim 45 cents per hour worked at your home office. A journal detailing hours worked is desirable.
  • Computer, internet, and phone expenses.

Making it All Simple

So what is the golden rule given the question, ‘which receipts should I keep for my taxes?’ Quite simply, it’s to maintain written evidence that verifies the claims you wish to make for your work related expenses. This is the safest option. It’s the digital age, after all, and we’re no longer confined to boxes and filing cabinets.

 

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