If you have been claiming tax deductions even when you don’t have a receipt, you should be aware of the possible repercussions because of the stricter rules set by the Australian Taxation Office (ATO). However, there may still be instances when it is acceptable to do so.
When you want to improve your tax refund, tax deductions may be the best way to do it, and these make the tax system fairer in a way. The idea is that if you spend money on something that is connected to how you make a living, you can get a refund for that.
For you to better understand this all, your trusted small business accounting experts will break it down for you in this article:
What Does the ATO Say About It?
According to ATO, if you purchased work-related items but you were not able to keep the receipt for that purchase, you can still claim up to $300, which is the maximum value.
But what if you spend more than $300? You may still be eligible to make a claim, but with no receipts, there’s always a possibility that you’ll be denied.
Can You Claim Food Expenses Without Receipts?
You should know that under normal circumstances, you are not allowed to make deductions for regular living expenses. The only exception is if your work situation obliges that you eat in your company café and you cannot come home to eat. And even then, you do need your receipts to make deductions.
Why Do You Need to Keep the Receipts for All Your Expenses and Purchases?
As tax time draws near, Aussies typically start preparing for their refund by collecting their receipts and other records that they can use to get their deductions. Any tax consultant will tell you that the easiest way you can get the ATO to approve your deduction is by presenting them with receipts.
Indeed, it is not always possible to get receipts, and the ATO understands that. Still, if you want to get refunded, you need to be able to show them how you were able to come up with the total amount of deductions. As such, you have to present them with proof like bank statements or whatever is appropriate.
Some examples of expenses that you may not be able to get receipts for include work-related expenses for your car, costs of uniforms, and more. Phone calls, training, travel, and more are also some work-related expenses that you can get a refund for.
Again, you can still get your deductions without a receipt, but you cannot get more than $300.
What Specific Expenses Can You Claim Refund For?
One of the things you can get a refund for is travel expenses. However, you should know that your daily commute to and from work does not count as a travel expense. However, if you get asked to attend a conference in the next town, then you can add that travel cost to your deductions.
If you pay for your uniform, and it’s specific to your job, then you can claim that amount as well. Furthermore, you can also claim the cost of the required courses that you had to take.
What Expenses Are Considered Allowable?
For an expense to be allowable, you should be able to answer the following questions with a “yes”:
- If they’re directly related to or needed for your occupation
- If you paid for them yourself
- If your employer did not reimburse you
There is no assurance that you will be granted a refund without receipts. For this reason, as much as possible, you must always collect those receipts so that you can present them to the ATO. While you may be allowed to get a refund for a limited amount when you don’t have the receipt, it is never assured.
If you have more tax-related questions, SMB Accounting is here for you. You can speak to our tax professional in Australia so that you can learn more about deductions and other tax-related matters!