What can a trade apprentice claim on tax?

There are a host of work-related items for which tradespeople can claim a tax deduction, from tools and mobile phone costs to sunscreen and safety glasses; the Australian Taxation Office (ATO) website has a comprehensive list. Generally, a trade apprentice can claim most expenses a qualified tradie can, but there are a few quirks that could be useful to know. Here’s what you need to know when it comes to tax claims for apprentices.

Basic tax rules for trade apprentices

The three rules to keep in mind when claiming a tax deduction are:

1. That you must have spent the money yourself;

2. The expense must directly relate to earning your income; and

3. You must have a record to prove it. A receipt is the best bet; bank and credit card statements usually aren’t sufficient.

And as you’d expect, if your employer reimburses you for a particular purchase, you can’t claim it as a tax deductible expense, and there’s no need to include it on your tax return.

Rules around allowances for apprentices

If your employer pays you an allowance, such as for tools, or compensation for certain working conditions, like working on a multistorey building, “You must include all allowances your employer reports on your income statement or payment summary as income in your tax return,” explains ATO Assistant Commissioner Rob Thomson. For example, if you get paid double time for working on Sundays, it must be declared as income. If you get a tool allowance, you declare the allowance as income on your tax return. If you spend the allowance on tools used for work, you can either claim as a decline in value deduction over the life of the asset, or immediate deduction if the cost of the asset is $300 or less and certain other conditions are met.

However, “Your employer may not include some allowances on your income statement – you will find these amounts on your pay slip,” Rob adds. “You don't need to declare these allowances as income in your tax return if you spend it in full on deductible work-related items and you're not claiming a deduction.” Travel and overtime meal allowances may also fall into this bracket.

Vehicle deductions apprentices can claim

Where you use your own vehicle for work, you can claim a deduction. What you can claim and how depends on whether the vehicle is classed as a car or other vehicle. For cars, you work out your tax deduction using either a cents-per-kilometre or logbook method. For other vehicles, such as a ute or motorbike, you can claim your actual costs for work-related use; keep all relevant receipts and maintain a record of work-related travel.

You usually can’t claim for trips between home and work unless you’re carrying tools essential for your job, they’re too bulky or heavy to be reasonably transported otherwise, like on the bus, and there’s no secure storage on site. But you can claim for trips between worksites on the same day, and if you attend TAFE, for example, you can claim a deduction for the cost of travel from your home or workplace to your place of education and back.

The myDeductions tool in the ATO app is a simple way you can record all your work-related trips.

Training, course fees and TAFE deductions

Training costs you pay that directly relate to your job are also eligible for a tax deduction. These include “course fees, student and amenities fees, textbooks, trade journals and stationery expenses”, Rob says. “You will also be able to claim a deduction for the decline in value of any depreciating assets which cost more than $300 that you use for your work-related study, such as a laptop.”

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The information in this article is general in nature. It doesn’t take into account your specific financial position, needs or circumstances. You should look at your own financial position, objectives and requirements and seek professional advice before making any financial decisions.