Getting ready for tax time
As a medical professional, you’re entitled to claim deductions for some expenses related to earning your income.
To know what you can claim, here's a Deduction Checklist from Dean Newberry & Partners.
You can claim a deduction for the cost of buying, hiring, repairing and cleaning certain work-related uniforms, occupation-specific clothing or protective clothing.
You may be able to claim a deduction for shoes, socks and stockings if they are an essential part of a distinctive compulsory uniform, the characteristics of which - colour, style, type - are specified in your employers unform policy. Wearing of the uniform must be consistently enforced.
** Generally, clothing is distinctive if it has the employer's logo permanently attached and the clothing is not available to the general public.
You can claim a deduction for the cost of buying, hiring, replacing or maintaining protective clothing.
Protective clothing is clothing that you wear to protect yourself from the risk of illness or injury posed by your income-earning activities or the environment in which you are required to carry them out, for example, non-slip nursing shoes.
You can also claim a deduction for the cost of clothing that you use at work to protect your ordinary clothes from soiling or damage, for example, laboratory coats and aprons.
LAUNDRY AND DRY-CLEANING
You can claim a deduction for the cost of laundering and dry-cleaning work clothes that are eligible deductions. For example, you can claim a deduction for cleaning a uniform that your employer provides and that you must wear to work.
You can claim laundry expenses for washing, drying and ironing such work clothes, including Laundromat expenses. If you claim for laundry expenses is $150 or less, you do not need written evidence; you may use a reasonable basis to work out your claim.
If you claim a deduction for laundry expenses that is more than $150 and your total claim for work-related expenses (other than car, meal allowance, award transport allowance and travel allowance expenses) exceeds $300, you need written evidence for the total claim. You can claim the cost of dry-cleaning work clothes if you have kept written evidence to substantiate your claim.
ANNUAL PRACTISING CERTIFICATE FEES
You can claim a deduction for the cost of renewing your annual practising certificate.
FIRST AID COURSES
You can claim a deduction for the cost of first aid training courses if you, as a designated first aid person, are required to undertake first aid training to assist in emergency work situations.
You can claim a deduction, called a capital allowance, for the decline in calie of equipment used for work.
If the equipment if also used for private purposes, you cannot claim a deduction for the part of the decline in value.
You cannot claim a deduction if the equipment is supplied by your employer or any other person.
Generally, that amount of your deduction depends on the effective life of the equipment. Equipment for which your may be able to claim capital allowance includes:
. Calculators and electronic organisers
. Computers and computer software
. Answering machines, telephones/mobiles, fax machines and other telecommunications equipment
. A professional library
. Tools and equipment
. Dedicated stopwatches and fob watches (but not ordinary wristwatches)
You may be entitled to claim deductions for the home office expenses:
. Running Costs may be deductable
. Occupancy expenses are generally not deductable for an employee
. You must keep records
SEMINARS, CONFERENCES AND TRAINING COURSES
You can claim a deduction for the cost of attending seminars, conferences and training courses that are sufficiently connected to your work activities.
You can claim a deduction for the cost of street directories, logbooks, diaries, pens and other stationery to the extent that you use them for work.
TECHNICAL OR PROFESSIONAL PUBLICATIONS
You can claim a deduction for the cost of journals, periodicals and magazines that have a content specifically related to your employment as a medical practitioner.
TELEPHONE CALLS, TELEPHONE RENTLAS AND CONNTECTION COSTS
You can claim a deduction for the cost of work-related telephone calls.
You can claim a deduction for your telephone rental if you can show that you are on call or are regularly required to telephone while you are away from your workplace.
If you also use your telephone for private purposes, you must apportion the cost of telephone rental between work-related and private use.
You need to keep a diary of work calls over a 4 week period to enable you to establish the business use percentage of your phone, alternatively you can identify the work-related calls from an itemised phone account.
You cannot claim a deduction for the cost of connecting a telephone, mobile, pager or any telecommunications equipment as it is a capital expense.
UNION AND PROFESSIONAL ASSOCIATION FEES
You can claim a deduction for these fees. If the amount you paid is shown on your payment summary, you can use it to prove your claim.
You can claim a deduction for Income Protection Insurance and Professional Indemnity Insurance.
However, insurances such as life insurance and trauma insurance are not deductable.
You should contact us if you are unsure what to claim.
MEDICAL BODY REGISTRATION FEES
All you Medical Body Registration fees are deductable. Examples include:
RACP, RACGP, AMA, AHPRA
This list doesn't cover everything; the best advice is to maintain an orderly record keeping system to allow easy review of all your expenses at tax time. You never know the tax saving you might find.
Want to know more? Contact David Tonellato (email@example.com) / Yvette Carver (YvetteCarver@deannewbery.com.au) / Carly Tkacz (Carly@deannewbery.com.au) or call 08 8267 4777.