Are you always on the lookout for ways to reduce your tax liability? As you may know, tax regulations are extensive and cover so many different areas and walks of life. Certainly, it can be difficult to keep up with all these rules, allowances, deductions and restrictions, but you still have to be sure before you itemise something on that all-important document. One area that seems to confuse people more than ever is an allowance for clothing. Is this something that you can claim or not?
There are many myths and misconceptions floating around that relate to clothing and tax. There are some situations where you can itemise workwear on your return but not as many as some people would believe.
How Do You Know?
For example, it's not possible to claim money that you spent buying clothes for your job just because your supervisor told you that you had to conform to a certain style. In other words, if you're told that you need a white shirt and black trousers, this is not specific enough and you will not be able to make a claim.
However, if you work in a themed restaurant, for example, and the uniform is very specific and designed to fit in with that theme, then you can may be able to claim the money that you had to invest in buying it. In this case, these clothes are unusual or specific to this particular organisation. Likewise, if you are told that you need to buy a specific item that has an embroidered logo, then this may be claimable, as it is distinctive.
You may also work in a restricted or challenging environment and are required to wear protective clothing to keep you safe. This is definitely allowable, and you should write that into your return with confidence.
You must also get into the habit of keeping accurate records, especially if you are claiming for laundry expenses associated with your allowable clothing. The ATO may have a threshold, beneath which they're not too concerned, but you should be able to explain how you arrived at your calculations if the question is ever asked.
Remember, if your claims are disallowed and the authority is not too happy with your attempt, you may be asked to repay any refunds made and could potentially face a fine, as well.
Get into the habit of asking for tax advice to clarify what you may claim.