COVID-19 work expenses Aussies can claim

The end of the financial year is just over a fortnight away, prompting millions of Australians to start putting their finances in order for the start of tax season.

This year’s returns face the added complexity of many workers returning to the office on a limited basis, which means many will have to calculate their day-to-day work-from-home expenses.

There’s also the confusing issue of expenses in the workplace, especially if you were to buy something that would allow you to work safely in the presence of COVID-19.

Millions of Aussies will be able to claim the cost of RAT kits if their workplace requires them to attend. (Flavio Brancaleone)

This year, the Australian Tax Office (ATO) advises that from July 1, 2021, taxpayers who have paid for a COVID-19 test for work-related purposes can now claim them as a deduction.

As always, taxpayers will have to prove that they purchased the tests themselves and must not have been reimbursed by their employer.

Of course, you can only claim a deduction for the tests you used to prove you were negative for COVID-19 on your way to work – not necessarily for all the tests you’ve ever taken.

“If you bought a COVID-19 test for a trip with your friends, you cannot claim a deduction,” ATO Deputy Commissioner Tim Loh said.

Retail workers who have not received protective measures against COVID-19 may be able to claim deductions for what they purchased. (AP)

As Loh explains, some occupations may also have had other pandemic-related expenses that were not covered by their employer.

“If you are spending your workday near customers and are at risk of contracting COVID-19, you may be able to claim a deduction for protective items such as gloves, face masks or sanitizer,” explains he.

“This will be most common in sectors such as retail, cleaning and hospitality.”

Above all, Loh said it was important for Australians to know which government payments qualify as taxable income.

JobSeeker payments are counted as taxable income and will be automatically pre-populated in recipients’ tax returns once they are ready.

Conversely, the Australian Government’s COVID-19 Disaster Payment (provided by Services Australia) is not taxable and does not need to be included on tax returns.

If you received a pandemic leave payment during this fiscal year, you will need to notify your accountant or report it to your accountant.

However, the Pandemic Leave Disaster Payment is taxable.

As Loh explains, this payment must be included in tax returns for the year of income in which the amounts were received. Services Australia sent a letter to recipients each time they received a payment.

Those who received the Pandemic Leave Disaster Payout will need to manually add up all amounts received and include the total amount received on their tax return. This payment will not be pre-filled in the declaration.

“Although the information is not pre-populated for you, failure to add pandemic leave disaster payments to your tax return will delay the processing of your return and your potential refund,” Loh said.

Taxpayers who have elected to use a registered tax agent should remember to notify their registered tax agent that they have received the Pandemic Disaster Payment.

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