As a trade business owner or worker, you can claim deductions for work-related expenses like tools, protective clothing and vehicle costs that are directly connected to your trade. Here are the key points.
What tradies can claim
If you’re employed as a tradie, you may be eligible to claim the following. This list isn’t exhaustive.
Tools and equipment
- The cost of tools, power tools, hand tools and equipment used in your work, including both purchase and repair costs.
- For tools or equipment used exclusively for work: if it costs more than $300, you can claim depreciation over several years. If it costs $300 or less, you can claim an immediate deduction for the full cost.
Protective clothing and safety gear
- Hard hats, steel toe boots, waterproof and composite toe boots, gloves, high-visibility apparel, water-resistant jackets and safety goggles.
Digital management systems
- Any app or digital tool you use to run your business, including Trak. The Australian government is also looking into a scheme that would let you deduct up to 20% of the total cost of these platforms.
Work-related vehicle expenses
- If you use your vehicle for work and meet the eligibility conditions: fuel, maintenance and repairs, insurance, registration and depreciation. Keep accurate records of everything.
Home office expenses
- If you have a dedicated space at home for admin related to your trade, you may be able to claim rent, mortgage interest, utilities and depreciation of office equipment.
Training and education
- Professional development, training courses, licences and certifications directly connected to your trade.
Travel and accommodation
- Work-related travel, including accommodation, meals and transport.
Union fees
- Membership fees for a union or professional association.
Worksite safety
- Safety signage, safety equipment and first aid kits.
Important guidelines
- If an item is used for both business and personal purposes, only claim the business portion. If you use your ute for work and personal trips, only the work share is deductible.
- The ATO may ask you to justify a claim, so keep detailed records: dates, vendors, amounts and the reason for the expense.
- If your employer or anyone else supplies or reimburses you for tools, equipment or other costs, you can’t claim a deduction for them.
General advice
This information is general in nature and doesn’t take your specific financial position, needs or circumstances into account. Always consider your own situation and objectives, and get professional advice before making financial decisions. Keep thorough tax records for all your expenses.