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Tax deductions without substantiations

Discussion in 'Accounting, Tax & Legal' started by invigrr8, 21st Jun, 2010.

  1. invigrr8

    invigrr8 New Member

    21st Jun, 2010
    Hi everyone,

    I'll just like to ask for what kind of things people claim on without having the need to substantiate with receipts and other kinds of proof.

    Having just found a new job after the GFC, I'm trying to maximise every dollar I can to keep on top of the mortgage. I know I probably won't get much more that not making any claims but any dollar helps at the moment. And I'm really trying to avoid seeing an accountant as I'm guessing my return won't be more than a couple hundred dollars.

    I am currently on a salary of about $48,000.00 and would like to maximise my tax return legally. I have been told by various people they make claims such as $200.00 on work expenses without the need of receipts or claiming less than 5000kms on business kilometres without the need to keep log books.

    Is there anything else I can claim this year without having to substantiate to the tax man to max my return? If yes, what amounts are the max without receitps.

    Thanks in advanced.
  2. Rob G.

    Rob G. Well-Known Member

    6th Jun, 2007
    Melbourne, VIC
    Substantiation is about complying with minimum documentary requirements before you can claim your work or travel expenses ... i.e. receipts.

    However, there are exceptions such as where the total of this class of expenses does not exceed $300.

    Also for individual small expenses not exceeding $10 for which it is unreasonable to obtain documents then you can create your own evidence provided the total does not exceed $200.

    If you want to claim work/travel expenses in excess of $300, then ALL expenses have to be substantiated.

    Does this mean you can arbitraily claim up to $300 without any evidence at all ?

    The answer is a definite NO !

    Where you are claiming without receipts, you need some other evidence that you reasonably incurred the expense AND it was for work/travel purposes.

    We are talking about secondary information such as credit card receipts, boarding passes or letters of acknowledgement for membership of your professional asssociation along with your diary entries showing time and activity in your home office, etc.

    Without such secondary information you cannot claim the even the first $300, and any audit may impose penalties as well as the GIC on overdue tax.

    Similar secondary evidence is needed to claim a car for work related travel using the cents per km method. You must establish on a reasonable basis the distance travelled for your income producing purpose.


    Last edited by a moderator: 22nd Jun, 2010