UPDATE: ATO Up’s Ante on False Deductions

UPDATE: ATO Up’s Ante on False Deductions

UPDATE: ATO Up’s Ante on False Deductions

The start of a new financial year sees some 10 million Australian’s complete their individual tax returns. The latest commentary from the ATO is that there are certain deductions they will be checking this year with a fine tooth comb. These include:

Person using calculator to work out deductions

Car usage claims

Work-related clothing; and

– Laundry costs

It is a myth that individuals can automatically claim $150 for work-related clothing and laundry – it needs to be for occupation-specific clothing. For example – office attire that can be worn outside work is not claimable.  Find out more here.


Many people try and fly under the radar by claiming up to allowable limits without receipts:

  • $150 for uniforms costs
  • Exactly 5,000 for work-related km’s
  • And exactly $300 for other work-related expenses

As such, the ATO is on to people who claim round numbers and will cross-check this against your occupation to see if it’s a legitimate claim.

Why is the ATO focusing on these deductions?

Because Australian’s avoid paying almost $9b in tax each year either through genuine mistakes on their tax returns, or those who decide to throw caution to the wind and claim more then what they should be.


Being online makes it easier to detect:

As a result of  most tax returns being done online, the ATO is better able to track and identify incorrect claims. A large portion of tax returns are now auto-filled, making mistakes much less likely to happen.

The ATO also cross-checks data from many third parties to ensure people are correctly claiming accurate income. With most of these transactions occurring in a digital environment, it makes this process much easier.

Some of the areas the ATO monitors:

  • If you’re an online seller, the ATO can access this information. If you’ve sold more then $12,000 in the last 12 months online, the ATO will know about it.
  • New car sales records are accessible by the ATO to cross check people who bought new cars in the last 12 months and the assessable income they are claiming – I.e. does your assessable income match the ability to buy a new car.


In summary, it’s not worth claiming deductions that you’re not entitled to or under-estimate your income. The ATO is very clear on this position, and it has the authority to access third-party data to check the legitimacy of your tax return.


I’ve already completed my tax return and now think it might be incorrect?

You can request an amendment to your tax return if you’ve made a mistake or left some information out that needs to be included. Feel free to get in touch with one of our team who can walk you through this process.


I’m not sure what I can and can’t claim?

It’s important to seek professional advice if your unsure as to which deductions you may be eligible for.

Get in touch with  the team if you’re not sure, we are happy to help.

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