Chartered Accountants ANZ (CA ANZ) says that while Australian taxpayers may welcome the standard $1,000 tax deduction for work costs announced by the Labor party yesterday, there is still a strong need for expert tax advice and the keeping of receipts.
“Chartered Accountants will still be required to navigate taxpayers through the nuances of the standard deduction,” said Susan Franks, CA ANZ Tax, Superannuation and Financial Advice Leader.
“Chartered Accountants play a vital role in supporting taxpayers during tax time and helping reduce the burden on the Australian Tax Office (ATO) when it comes to mistakes from work expense claims.
“We know the majority of people claim more than this standard deduction and the profession expects to continue supporting taxpayers going forward.”
CA ANZ is warning that simplicity may come at a cost to the taxpayer.
Data from the ATO shows most taxpayers claim more than $1,000 of work-related deductions.
“Individuals, in particular sole traders, will still need to speak to a Chartered Accountant to determine whether they are better off claiming the standard $1,000 deduction or actual costs.
“Those undertaking tertiary education or professional continuing education, for example, should definitely keep all of their receipts as their claims are generally well in excess of $1,000.
“So too should people who use the cents per kilometre method for car expenses who exceed 1,140 business kilometres a year.
“If you are going to claim actual costs, it is likely that you will need receipts for every dollar spent – not just the amount over $1,000.
“Understanding when and what expenses the standard deduction encompasses is important.
“The standard deduction only relates to expenses associated with labour, so those taxpayers who also earn business income, rental income, interest and dividends and those who are feeling charitable will need to keep their receipts to claim deductions related to those activities.
“The standard deduction applies from 1 July 2026, so I wouldn’t be throwing receipts in the bin just yet. You will need them to claim for expenses incurred up to 30 June 2025 and will have to retain them for five years after your tax return is lodged.
“And going forward, it’s worth noting, the standard deduction, like personal tax rates will be affected by inflation. Its value to taxpayers will decrease as inflation increases.”
ENDS
For more information contact:
AUSTRALIA Gillian Bowen, Public Affairs Manager Australia M +61 411 485 421 gillian.bowen@charteredaccountantsanz.com
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About Chartered Accountants Australia and New Zealand
Chartered Accountants Australia and New Zealand represents nearly 140,000 financial professionals, supporting them to make a difference to the businesses, organisations and communities in which they work and live. Chartered Accountants are known as Difference Makers. The depth and breadth of their expertise helps them to see the big picture and chart the best course of action.