The ATO has advised that it is writing to around 218,000 individuals employed as building construction project managers and supervisors, building and construction labourers, and sales and marketing managers about their work-related expenses. It said it has found that individuals in these occupations are at higher risk of making mistakes with their work-related expenses due to the types of deductions they are entitled to claim.
The ATO has also advised that it will be writing to more than 110,000 rental property owners regarding their entitlements and obligations to ensure their 2012-13 tax returns are filled in correctly. To that end, it has provided a guide on costs which can be claimed immediately, and costs that can be claimed over a number of years. In addition, the ATO also provides information on what costs cannot be claimed in relation to a rental property and what taxpayers should do if they have sold a rental property.
In the 2011-12 Budget the government announced that it would make changes to disallow deductions against government payments.
On 27 June 2012 these changes came into effect when the legislation received royal assent. The new law is effective 1 July 2011 and expenses that relate to meeting the ongoing requirements to receive certain government assistance payments can not be claimed as a deduction.
Government assistance payments that are no longer eligible for deductions include:
- Newstart Allowance
This brings the long fight by the ATO against deductions from student allowances to an end. The ATO lost the court cases so the government chnaged the last. See https://thomsonhall.com.au/wordpress/tag/education/ for ealier parts of this story.
At a press conference on Tuesday , June 19, the Treasurer indicated that the proposal to provide individuals with an optional standard deduction of $500 for work-related expenses and the cost of managing tax affairs would not be revisited.
This year’s Federal Budget in May announced that it would not go ahead. Mr Swan said the Government decided to raise the tax-free threshold and while it was “not a complete substitute” for the standard deduction, it was “a fundamental economic reform and tax reform in place that goes to workforce participation in particular”. When asked if this would be reviewed, he said “I can’t at this stage see it being revisited. I’ve never raised any expectation that it would be and I can’t see that it will be at this stage.”