Self-Education & Immediate deduction - Tax Return

Hi all, got a few questions.

It's that time of the year again… well getting there and I'll like to prepare a few things for my first proper tax return. So… I recently left my role where my previous employer paid for 3 of my courses and textbooks (1 course relates to FY19) and as a result I had to pay them back the 3 courses (Paid in FY20). So I was wondering if I'm able to deduct all 3 courses even though 1 of the courses was paid by my previous employer in FY19.

Also, I wanting to confirm regarding the working from home office expenses, can I immediately deduct all items that cost under $300 (doesn't matter how many items, as long as it's under $300), and do I have to apportion the expense?

Finally, I recently purchased a computer used partially for work/study/gaming etc. The invoices are directed towards my brother (same household) since I wanted to use the 28 degree price protection, but the intention was for me to use it. Can I still make a deduction claim on it? Also, is there a list/excel listing the average depreciation rate of assets (computer, chairs, desks etc.)

Cheers

Comments

  • +1

    1.) don't see why not, you incurred the expense in 19/20
    2.) any item under $300 can be expended immediately, pro rated for works vs personal usage. Only exception is if those items made a set, ie $299 ram, cpu, gpu, case etc to make a pc. If its just a monitor, a chair, etc i don't see why not
    3.) don't see why not, so long as your brother isn't double dipping and you can provide proof of xfer of money to your brother.

  • +1

    1) The deductions are relevant to when YOU incurred the expense, so all 3 can be deducted for FY20. NB: You should read the ATO page on what constitutes a deductible self-education expense. I know I couldn't claim my engineering course as it wasn't a requirement for the job I had, it was a requirement for the job I wanted.

    2) I don't know. The ATO page on WFH should have a lot of info now as so many are doing it.

    3) I've done this (receipt in one name, another person paid/using). It's fine as long as you don't double dip (both you and your brother claiming… unless he uses it for work too).

    You will find recommended depreciation rates on the ATO website. It's likely most of your low value items can be written off immediately (if that suits your tax situation),

    My tip: Don't get greedy. eg: I use my laptop for share trading and keeping a record of capital gains, dividend income, research, etc. Investment income represents 20% of my total income so I claim 20% of the cost of the laptop (I don't depreciate, I just claim it as an expense - it's probably wrong but it isn't questioned).

    Internet I use for work as well, so I usually claim 20% investment + 10% work but now I'm WFH I'm increasing that to 20% + 50%. (plus the other WFH expenses).

    1. For individuals, income and expenses are accounted on a cash basis. So yes, if you paid in FY20 and there is nexus between the course and your profession and you meet the deductibility criteria, it would be fine to include.

    2. Probably best to check the website for most recent guidelines. (see below)

    3. Does your work provide a laptop/computer for work? If yes, it would be a difficult argument convincing ATO why you had to purchase another laptop for work? You cannnot claim a deduction for items provided by your employer.

    Maybe you could argue for studies…..Also given the invoice is not in your name, its a long winded path to convince ATO (show proof that you paid your brother etc…..). If I were you, I would let this one go……. blurring the line but I leave that to your discretion.

    https://www.ato.gov.au/general/covid-19/support-for-individu...

    Check this for short cut method (re depreciation and other running costs). 80 cents each hour you work from home. I would compare this against fixed rate method and factor in paper work required etc. Short cut method is simple and not much required - if the deductions are not material, that is what I would do. Though i am not sure what sort of numbers you are looking at.

    • +1

      I've been WFH for 12 weeks The deduction for that is $384 (12w x 40hrs x 0.80) which is effectively $142.08 back in my pocket. My power bill has gone up more than that.

      The coffee bill has also gone crazy without access to the company espresso machine. :-(

      • You are earning enough to cover the coffee bill :)

      1. I'm living at home with my parents ATM, so I wont be eligible for the running costs deduction.

      2. Yea, that's the plan I'm going to argue that I use the computer as part of my studies, I can provide an audit trail of cash transfer if it is required.

      Thanks for everyone's input tho.

      • Just claim the flat 80c/hour. Pay the refund to your parents. The ATO don't know that you aren't paying board to your parents. As long as your claims are in good faith and you don't get greedy the ATO won't question it.

  • Can you claim furniture/ equipment worth less than $300 each separately if you are using 52c per day flat rate method?

    I believe you can't do this if you use 80c per day method. Is that right?

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