Below are a number of expenses commonly incurred by hospitality industry employees.
You can claim a deduction for the depreciating assets you purchase and use for work. The deduction you can claim is worked out on the effective life of the equipment and the decline in value of equipment over the time it is used for work. If the equipment is also used for private purposes, you cannot claim a deduction for that part of the decline in value.
You cannot claim a deduction if the equipment is supplied by your employer or any other person.
You may be able to claim a capital allowance for the following equipment:
- Answering machines, telephones, facsimile machines, mobile phones, pagers and other telecommunications equipment.
- Calculators and electronic organisers.
- Computers and computer software.
- Tools and equipment.
- A professional library.
Equipment costing $300 or less
If you purchased equipment costing $300 or less and you use it mainly for work, you can claim an immediate deduction for the work-related portion of the cost.
You cannot claim an immediate deduction if:
- The equipment is part of a set that you buy in the same income year and the total cost of the set is more than $300 (the set rule).
- The equipment is one of a number of identical or substantially identical items you buy in an income year and the total cost of these items is more than $300 (the multiples rule).
You can claim a deduction for the cost of renewing your special employees or gaming licence. You cannot claim a deduction for the cost of getting your initial licence.
Grooming including hairdressing, cosmetics, hair and skin care products
You cannot claim a deduction for hairdressing, cosmetics, hair and skin care products, even though you may be paid an allowance for grooming and be expected to be well groomed. All grooming products are private expenses.
You can claim the costs of hiring equipment used for work. If the equipment is also used for private purposes, you cannot claim a deduction for that part of the hire cost.
You can claim a deduction for the additional running expenses of an office or a study at home that you use for income-producing activities. Running expenses include the decline in value of home office equipment, the costs of repairs to your home office furniture and fittings, and heating, cooling, lighting and cleaning expenses. You cannot claim occupancy expenses (for example, rent, rates, mortgage interest and house insurance premiums) unless you are carrying on a business. If your only income is paid to you as an employee, you are not considered to be carrying on a business.
Diary records noting the time the home office was used for work are acceptable evidence of a connection between the use of a home office and your work. You will need to keep diary records during a representative four-week period.
Place of business
You can claim a deduction for part of the running and occupancy expenses of your home if you use an area of your home as a place of business. There may also be capital gains tax implications if you sell your home and it has been used as a place of business.
Insurance of equipment
You can claim a deduction for the cost of insuring your tools and equipment to the extent that you use them for work.
You can claim the cost of interest on money borrowed to purchase work-related equipment. If the equipment was also used for private purposes, you cannot claim a deduction for that part of the interest.
You cannot claim a deduction for the cost of meals eaten during a normal working day as it is a private expense, even if you receive an allowance to cover the meal expense.
An amount for overtime meals that is part of your normal salary and wage income is taxed as part of your income. It is not the same as an 'overtime meal allowance'.
You must include amounts you received as overtime meal allowance as an allowance.
You will need written evidence if your claim per meal is more than the reasonable rate stated in:
- Taxation Determination TD 2016/13 Income tax: what are the reasonable travel and overtime meal allowance expense amounts for the 2016-17 income year?
- Taxation Ruling TR 2004/6 Income tax: substantiation exception for reasonable travel and overtime meal allowance expenses
You can claim for overtime meal expenses incurred only on those occasions when:
- You worked overtime
- You received an 'overtime meal allowance' for that overtime.
If you received an award overtime meal allowance which is not shown on a payment summary, you may choose not to include the allowance as income and therefore not claim a deduction, as long as:
- The allowance does not exceed the Commissioner’s reasonable amounts, and
- You have fully spent it on deductible expenses.
You can claim a deduction for the cost of repairing tools and equipment for work.
If the tools or equipment were also used for private purposes, you cannot claim a deduction for that part of the repair cost.
You can claim a deduction for the cost of street directories, logbooks, diaries, pens and other stationery to the extent that you use them for work.
Technical or professional publications
You can claim a deduction for the cost of journals, periodicals and magazines that have a content sufficiently connected to your employment as a hospitality employee.
Telephone calls, telephone rental and connection costs
You can claim a deduction for the cost of work-related telephone calls.
You can claim a deduction for your telephone rental if you can show that you are on call or are regularly required to telephone your employer while you are away from your workplace. If you also use your telephone for private purposes, you must apportion the cost of telephone rental between work-related and private use.
You cannot claim a deduction for the cost of connecting a telephone, mobile phone, pager or any other telecommunications equipment as it is a capital expense.
You cannot claim a deduction for the cost of an unlisted telephone number (silent number) because it is a private expense.
Union and professional association fees
You can claim a deduction for union and professional association fees. If the amount you paid is shown on your payment summary, you can use it to prove your claim. You can claim a deduction for a levy paid in certain circumstances, for example, to protect the interests of members and their jobs.
You cannot claim a deduction for joining fees, levies or other amounts you paid to assist families of employees suffering financial difficulties as a result of employees being on strike or having been laid off.