Every year, as EOFY approaches, small business owners and sole traders consider the same questions: “What can I actually claim?” and “Will the ATO really care if I throw that in too?” The short answer is: “More than you think, and yes they care.”
If you’ve ever sat down at tax time and asked yourself, “Can I claim this?”, you’re not alone. Whether it’s a streaming subscription, home office expenses, or something a little more creative (looking at you, air fryer), the rules can feel both flexible and incredibly strict at the same time.
We recently shared some thoughts with Business Builders about the more unusual deductions Aussies try to claim, and what actually stacks up with the ATO.
A few highlights from the article:
- Strange doesn’t always mean wrong
Some expenses sound like a stretch but are actually allowed, as long as they tie directly to your work. Subscriptions like Netflix, Kayo, Spotify or Audible can be partially deductible if you’re using them for professional purposes. A sports coach reviewing match footage or a journalist analysing documentaries might be able to claim a portion of their subscription. But if you’re just streaming reality TV to unwind, the ATO sees that as personal use. - Working from home? Pick a method
This year, the ATO is focusing on people who try to claim more than they should under working from home rules. There are two options: the fixed rate method, which lets you claim 70 cents per hour worked from home and includes things like electricity, phone and internet; or the actual cost method, where you claim individual bills based on usage. You need to choose one or the other. Mixing the two will raise red flags. - Side hustles aren’t invisible
Platforms like Uber, Airbnb and Fiverr now report income directly to the ATO. If you’re earning extra on the side, it needs to be declared. The upside is you can also claim deductions for any costs directly related to that work—whether that’s fuel, equipment, website hosting or supplies. Just make sure you’re keeping receipts and records. If money is coming in, they’ll expect to see what went out too. - Creative doesn’t mean claimable
Some of the deduction attempts flagged by the ATO this year include swimwear, designer clothing and gaming consoles. All were listed as “work-related” but didn’t meet the standard. Unless it’s a uniform, protective gear or a tool used in your actual job, it’s unlikely to be approved. Just because something helps you feel more comfortable or productive doesn’t automatically make it deductible.
The bottom line? If an expense genuinely supports your income and you’ve got the records to prove it, it’s often claimable. But the ATO has zero tolerance for guesswork, exaggeration, or creative fiction.
The article goes into more details. You can also see some of other insights:
- Tax Deductions for Freelancers
- Working from Home: Tax Deductions and Calculator
- A Quick & Easy Guide to Tax Deductions in Australia
And if you’re still not sure what you can or can’t claim, One Click Life is here to make tax simple. We take the guesswork out of deductions; no spreadsheets, no jargon, just straight-up support when you need it.
Talk to us today.