Tax Return Deductions

June 18th, 2010

If you are wondering which expenses you can claim back on tax, this should give you a good idea. Tax deductions are your way of keeping more of your earnings in your own pocket, so it is important to know which expenses are eligible.

The main point is that these expenses need to be work-related, although they do not need to be wholly so. For example, if you run your car both for business and pleasure purposes, a proportion of the related expenses you can claim back on tax.

One of the best ways of ensuring you keep track of business-related costs is to use a credit card so that you have a record of the transaction, although you would obviously also need to get an invoice for tax purposes.

As this whole area is quite complex and there are differences in what you can claim back back on tax depending on the kind of job you do, you may want to consult a professional tax adviser to make sure you get the most out of it.

Expenses you can claim back on tax

Vehicles – This will include fuel, insurance, any repair or maintenance costs, and the purchase costs of any vehicles.

Travel – Business-related travel can be included, and this will include accommodation, dining out, and obviously any tickets purchased.

Education – You can claim back on tax any expenses on training or educational resources that relate to your business endeavours, for example a seminar or reference materials.

Clothing – Clothing specifically bought for your job of work you can claim back on tax.

Tools and equipment – Similarly, work-related items bought so you can function in your job are eligible.

Insurance – If you are required to have any special insurances for your work, these can be included in your legitimate expenses.

Depreciation – This is often missed by many people. Physical assets like vehicles depreciate in value, and this loss you can claim back on tax.

Home office – Any expenses you incur when working from home can be at least partly put down as expenses, although you should check with a tax adviser.

Charitable donations – Donations to charity, for example if you sponsor a local team in exchange for a bit of free advertising, or you donate to a good cause in the name of your business.

Tax losses – Losses from your previous year of trading you can claim back on tax in the current year.

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