There are many myths about deductions that may lead you to make an incorrect claim. Here are some of the most common.

MYTH: Everyone can automatically claim $150 for clothing and laundry, 5,000 km under the cents per kilometre method for car expenses, or $300 for work-related expenses, even if I didn’t spend the money.

FACT: There is no such thing as an ‘automatic’ or ‘standard deduction’. Substantiation exceptions provide relief from the need to keep receipts in certain circumstances. You must still have spent the money, it must be relating to earning your income and you must be able to explain how you calculated your claim.

MYTH: I don’t need a receipt, I can just use my bank or credit card statement.

FACT: To claim a tax deduction you need to be able to show that you spent the money, what you spent it on, who the supplier was and when you paid. Bank or credit card statements alone do not have this information.

MYTH: I can claim all my travel expenses if I add a conference or a few work days’ work to my holiday.

FACT: If you decide to add a conference or some work to your holiday you must apportion the travel expenses between the private and work-related components, and only claim the work-related component.

MYTH: I can claim my work clothes because my boss told me to wear a certain colour.

FACT: Unless your clothing is a uniform that is unique and distinct to your employer, you won’t be able to claim it. Plain clothes, like black pants, are not deductible even if your employer told you to wear them.

MYTH: I can claim home to work travel because I need to get to work to earn my income.

FACT: For most of us, home to work travel is a private expense.

The ATO has released an employees’ guide for work expenses to help them decide whether their expenses are deductible, and what records they need to keep to substantiate them.

The Guide says that not all expenses associated with employment are deductible and explains:

• How to determine if an expense is deductible against an employment income
• How to apportion expenses if they are only partly deductible
• How to work out whether an employee can claim a deduction in the year incurred or whether they need to claim a deduction for decline in value over a number of years
• What records an employee needs to keep