Tax deductions you never knew you could make

Making sure you claim everything you’re legitimately eligible for can have a big impact on your annual discretionary income. But do you know what you can claim?

What is tax deductible?

When completing your tax return, bear in mind that there are a number of tax deductions you can claim against expenses related to your work. What each person can claim will vary depending on their occupation. To make a deduction for a work-related expense, you need to have spent the money yourself without being reimbursed by work, and the cost needs to directly relate to earning your income. You’re also going to need a record to prove the expense, usually a receipt.

While travel expenses, home office expenses, education and mobile phone expenses are commonly claimed, there are a number of deductions often overlooked that you may be able to claim when completing your tax return.

Artwork

Regardless of why you bought your latest artwork, the Australian Taxation Office views artwork as both an investment and a depreciating asset, meaning you can claim it as a tax deduction. How much you can claim will be determined by the size of your business and whether you are an employee.

If you work from home, you can claim a deduction for your artwork up to the value of $300 as part of your home office expenditure. Small and medium sized business owners can make a much higher claim for artwork.

An apartment in another city

Investment properties purchased away from your home that you stay in when travelling for work can be claimed.

Under ATO guidelines, if you’re required to work away from home and you choose to rent or buy an apartment in the other work location rather than relying on hotel accommodation, you can claim a deduction for the work-related costs that apply to the apartment. This includes rent or interest on the mortgage.

Work handbag

Each year, you are allowed to claim a bag that you use for work. This could be a laptop bag or backpack used for carrying work-related items, but claiming a designer luxury handbag, may raise a few eyebrows at the ATO. If you carry your laptop, tablet and paperwork in a bag for work, then claim it. If you’re using it for gym equipment or your lunch, don’t.

COVID tests

The ATO will let you claim the cost of a COVID test if it was used to see whether you are sick and therefore unable to attend work. This is particularly the case if you’re in a customer-facing role and you need to purchase the test to stop the spread of the disease.

Man’s best friend

In some limited circumstances, you may be able to claim a deduction for the cost of buying and caring for a dog if they assist in your occupation. The two most common scenarios for this claim are farming and security reasons.

A caravan

The ATO allows for travel expense claims and there have been instances where taxpayers have claimed a caravan — and it was accepted. If you travel extensively for work and a caravan is saving you from paying for a hotel room, you may be able to apportion the deduction if it is used for work, rather than private use.

Meals away from home

If you’re travelling for work, you can claim the cost of meals when you travel and stay away from home overnight. You may also be able to claim a deduction for the cost of a meal you buy and consume when working overtime.

Media subscriptions

Many media publications are now subscription-based and can be deductible if they relate to your profession. This includes subscriptions to newspapers, professional magazines and podcasts that are linked to your profession.

Desk lamps and stationery

You don’t have to be running a business from home to make work-related claims. If you have a dedicated workspace at home where you’re doing a few hours of work at home a week, you can claim a number of related items, including lamps, stationery, a shredder and printer cartridges.

Protective clothing

If it’s related to your work, you can claim
the cost of buying items like fire resistant clothing, steel-capped boots, hi-vis vests or sun protection. This can apply to people working directly on site, like construction workers, but also related industries, such as engineers and architects who visit.

Depending on your industry, you can claim items that relate to your work, including a bullet proof vest if you’re a police officer or anything used that relates to your performance if you’re a professional athlete. Media professionals can also claim sunglasses if they are required to be out in the sun in the course of their work.

While you’re at it, you may also be able to claim the costs to clean occupation-specific clothing, so ask your tax accountant.

Tax accountancy fees

Last but not least, the fees you pay for the preparation of your annual tax return if you used a tax agent to prepare and lodge your tax return can be claimed on this year’s tax return.

The ATO has a number of online tools and calculators to help you calculate your deduction correctly, including work from home, self-education and car expenses.

Visit the ATO website and type ‘calculators’ into the search bar.

There has rarely, if ever, been so much tech talent available in the job market. Yet many tech companies say good help is hard to find.

What gives?

U.S. colleges more than doubled the number of computer-science degrees awarded from 2013 to 2022, according to federal data. Then came round after round of layoffs at Google, Meta, Amazon, and others.

The Bureau of Labor Statistics predicts businesses will employ 6% fewer computer programmers in 2034 than they did last year.

All of this should, in theory, mean there is an ample supply of eager, capable engineers ready for hire.

But in their feverish pursuit of artificial-intelligence supremacy, employers say there aren’t enough people with the most in-demand skills. The few perceived as AI savants can command multimillion-dollar pay packages. On a second tier of AI savvy, workers can rake in close to $1 million a year .

Landing a job is tough for most everyone else.

Frustrated job seekers contend businesses could expand the AI talent pipeline with a little imagination. The argument is companies should accept that relatively few people have AI-specific experience because the technology is so new. They ought to focus on identifying candidates with transferable skills and let those people learn on the job.

Often, though, companies seem to hold out for dream candidates with deep backgrounds in machine learning. Many AI-related roles go unfilled for weeks or months—or get taken off job boards only to be reposted soon after.

Playing a different game

It is difficult to define what makes an AI all-star, but I’m sorry to report that it’s probably not whatever you’re doing.

Maybe you’re learning how to work more efficiently with the aid of ChatGPT and its robotic brethren. Perhaps you’re taking one of those innumerable AI certificate courses.

You might as well be playing pickup basketball at your local YMCA in hopes of being signed by the Los Angeles Lakers. The AI minds that companies truly covet are almost as rare as professional athletes.

“We’re talking about hundreds of people in the world, at the most,” says Cristóbal Valenzuela, chief executive of Runway, which makes AI image and video tools.

He describes it like this: Picture an AI model as a machine with 1,000 dials. The goal is to train the machine to detect patterns and predict outcomes. To do this, you have to feed it reams of data and know which dials to adjust—and by how much.

The universe of people with the right touch is confined to those with uncanny intuition, genius-level smarts or the foresight (possibly luck) to go into AI many years ago, before it was all the rage.

As a venture-backed startup with about 120 employees, Runway doesn’t necessarily vie with Silicon Valley giants for the AI job market’s version of LeBron James. But when I spoke with Valenzuela recently, his company was advertising base salaries of up to $440,000 for an engineering manager and $490,000 for a director of machine learning.

A job listing like one of these might attract 2,000 applicants in a week, Valenzuela says, and there is a decent chance he won’t pick any of them. A lot of people who claim to be AI literate merely produce “workslop”—generic, low-quality material. He spends a lot of time reading academic journals and browsing GitHub portfolios, and recruiting people whose work impresses him.

In addition to an uncommon skill set, companies trying to win in the hypercompetitive AI arena are scouting for commitment bordering on fanaticism .

Daniel Park is seeking three new members for his nine-person startup. He says he will wait a year or longer if that’s what it takes to fill roles with advertised base salaries of up to $500,000.

He’s looking for “prodigies” willing to work seven days a week. Much of the team lives together in a six-bedroom house in San Francisco.

If this sounds like a lonely existence, Park’s team members may be able to solve their own problem. His company, Pickle, aims to develop personalised AI companions akin to Tony Stark’s Jarvis in “Iron Man.”

Overlooked

James Strawn wasn’t an AI early adopter, and the father of two teenagers doesn’t want to sacrifice his personal life for a job. He is beginning to wonder whether there is still a place for people like him in the tech sector.

He was laid off over the summer after 25 years at Adobe , where he was a senior software quality-assurance engineer. Strawn, 55, started as a contractor and recalls his hiring as a leap of faith by the company.

He had been an artist and graphic designer. The managers who interviewed him figured he could use that background to help make Illustrator and other Adobe software more user-friendly.

Looking for work now, he doesn’t see the same willingness by companies to take a chance on someone whose résumé isn’t a perfect match to the job description. He’s had one interview since his layoff.

“I always thought my years of experience at a high-profile company would at least be enough to get me interviews where I could explain how I could contribute,” says Strawn, who is taking foundational AI courses. “It’s just not like that.”

The trouble for people starting out in AI—whether recent grads or job switchers like Strawn—is that companies see them as a dime a dozen.

“There’s this AI arms race, and the fact of the matter is entry-level people aren’t going to help you win it,” says Matt Massucci, CEO of the tech recruiting firm Hirewell. “There’s this concept of the 10x engineer—the one engineer who can do the work of 10. That’s what companies are really leaning into and paying for.”

He adds that companies can automate some low-level engineering tasks, which frees up more money to throw at high-end talent.

It’s a dynamic that creates a few handsomely paid haves and a lot more have-nots.