Start with the right goal: a correct return, not a guess
When tax time arrives, many people ask the same question: “How can I maximise my refund?” It is a sensible question, but the best outcome does not come from adding every possible expense or relying on a rough estimate. It comes from lodging a complete, accurate return that includes all income, claims every deduction you are genuinely entitled to, and is backed by clear records.
A refund is simply the result of the tax already paid during the year being more than your final tax liability. A larger deduction may reduce taxable income, but it does not mean you are reimbursed for the full cost of an item. Spending money purely to create a deduction is rarely a sound financial decision.
For employees, sole traders and investors alike, the strongest approach is to understand the connection between an expense and the income you earn. The ATO’s guidance is clear that a work-related expense generally needs to be paid by you, not reimbursed, directly connected with earning income, and supported by records. Private, domestic and capital expenses are treated differently, and mixed-purpose expenses need a reasonable work-related split.
Taking a little more time before lodging can help you identify overlooked claims without creating avoidable risk. It also puts you in a better position if the ATO later asks how you calculated an amount.
Make sure every source of income is included
Before focusing on deductions, check that the income side of the return is complete. An overlooked income amount can reduce or eliminate an expected refund, particularly if it is identified after lodgment and the return needs to be amended.
Online pre-fill information is useful, but it is not a substitute for reviewing your own records. Information can arrive at different times, and the ATO says you remain responsible for checking that all pre-filled and manually entered details are correct before lodging. In practice, this means comparing the return against your income statements, bank records, investment statements and other relevant documents.
Depending on your circumstances, your income checklist may include:
- salary, wages, allowances, bonuses and commissions;
- interest from bank accounts and term deposits;
- dividends and managed fund distributions;
- income from a rental property or holiday home;
- sole trader or contractor income;
- partnership or trust distributions;
- capital gains or losses from selling investments, property or other assets; and
- income earned through digital platforms, content creation, freelance work or side businesses.
This is particularly important for sole traders. Business income and expenses need to be reported in the appropriate business section of the individual return, with details of the main business activity and ABN where required. A personal bank account used for business receipts can make record keeping harder, but it does not change the requirement to report the income.
Allowances are another area that deserves care. Receiving an allowance does not automatically create a deduction. If an allowance is included in your assessable income, you may be able to claim eligible expenses it covers, but only to the extent you actually incurred them, were not reimbursed, and meet the usual deduction and substantiation requirements.
Claim work-related deductions with evidence and a clear connection
Work-related deductions are often where taxpayers have the greatest opportunity to improve the accuracy of their return. They are also an area where assumptions can cause problems. The starting point is not the occupation title or what colleagues claim. It is whether the particular expense was incurred in performing your own income-producing duties.
Common categories that may be relevant, depending on the role and circumstances, include professional memberships, union fees, protective or occupation-specific clothing, tools and equipment, work-related phone and internet use, self-education, and some travel expenses. A deduction is only available for the work-related component where an item has both work and private use.
Separate legitimate claims from common misconceptions
There is no automatic entitlement to a standard amount of work-related deductions. Even where receipts are not required under a particular substantiation concession, you still need to be able to show that you incurred the expense and explain how the claim was calculated. A bank statement alone will not always establish what was purchased, its connection to income, or the work-related proportion.
Normal travel between home and a regular workplace is generally private and not deductible, even if you answer emails on the way, work from home at other times, or live a long distance from the workplace. There are limited exceptions, such as certain travel between workplaces or travel to an alternative workplace required by employment duties, but the facts matter. The ATO’s public ruling on employee transport expenses emphasises that deductibility requires a practical assessment of the connection between the journey and the employment.
Likewise, everyday clothing, meals bought during an ordinary workday, and expenses paid or reimbursed by an employer are not claims to add simply because they feel work-related. A careful review is more valuable than a long list of uncertain deductions.
Consider self-education carefully
Self-education expenses may be deductible where the course has a sufficient connection to the income you earn from your current employment activities. The connection needs to exist when the expense is incurred. A course that maintains or improves skills used in your current job may be treated differently from study that is designed to help you move into an entirely new field.
Keep invoices, course outlines, payment confirmations and a short note explaining how the study relates to your current work. That simple file can make a future tax return easier to prepare and gives you a clear explanation if your claim is reviewed.
Handle working from home claims with care
Working from home can create deductible additional running expenses, but it does not make every household cost deductible. The ATO requires you to be working from home to fulfil employment duties, rather than only undertaking minimal tasks such as occasionally checking emails. You must also incur additional running expenses and keep records showing that you incurred them.
There are two calculation approaches recognised in ATO guidance: a fixed-rate method and an actual-cost method. The appropriate method depends on your circumstances and records. Neither method is automatically better for everyone, and the method that produces the highest figure is not necessarily the method you can properly support.
For the fixed-rate approach, the ATO’s practical compliance guidance requires records of actual hours worked from home across the income year, as well as evidence that you incurred the relevant running expenses. An estimate based on a usual weekly pattern is not enough where the guidance requires a record of actual hours.
Expenses that may be relevant in a working-from-home calculation can include energy, internet, phone usage, stationery, computer consumables, and the decline in value of eligible equipment. However, claims cannot be duplicated. If a category is covered by a fixed-rate calculation, it cannot also be claimed separately under another label.
Occupancy expenses, such as rent, mortgage interest and property insurance, are generally private in nature for employees working at home. They may only be relevant in limited circumstances, so this is an area where tailored advice is worthwhile before making a claim.
A practical habit is to keep a calendar or timesheet record of home-working hours as the year progresses, rather than trying to reconstruct them at tax time. Save one folder for bills, equipment invoices and employer reimbursement records. Good records give you choices when it is time to determine the most appropriate method.
Do not overlook investments, rental property and superannuation
Individual tax returns are often more complex where you hold investments, receive trust distributions, own property, or make personal superannuation contributions. These areas can offer legitimate deductions, but timing, ownership structure and documentation are important.
Rental property records can affect more than this year’s return
Rental income must be declared, and expenses need to be considered in light of whether the property was rented or genuinely available for rent. Some costs may be immediately deductible, while other expenditure may need to be claimed over time or may form part of the asset’s capital gains tax cost base. It is important not to assume that every payment connected with a property is an immediate deduction.
Keep property manager statements, tenancy documents, loan records, invoices, receipts and evidence of repairs or improvements. The ATO says rental income and expense records generally need to be retained for the relevant record-keeping period, while records connected with acquiring or disposing of property may need to be kept longer for capital gains tax purposes.
Personal super contributions need the right process
A personal contribution to superannuation is not automatically deductible just because it was paid from your bank account. Where you intend to claim a deduction, you generally need to give your super fund a valid notice of intent in the approved form and receive the fund’s written acknowledgement before claiming the deduction in your tax return. The amount claimed should match the amount stated in the valid notice.
There are deadlines and other eligibility conditions, and a deduction can affect contribution caps and other superannuation outcomes. For this reason, it is wise to seek advice before lodging a return if you have made a large personal contribution, changed funds, started an income stream, or are considering varying a notice.
Donations should be checked, not assumed
Gifts and donations may be deductible where they are made to an organisation with deductible gift recipient status and the relevant requirements are met. A receipt will usually indicate whether the contribution is deductible. If you received a material personal benefit in return, such as goods, raffle tickets or event entry, the payment may not be fully deductible.
Keep donation receipts together throughout the year, including workplace-giving records. If a donation was made jointly, only claim your own share.
Build records during the year, then review before lodging
Good tax outcomes are usually created well before EOFY. A folder on your phone, cloud storage or accounting platform can make the difference between a well-supported claim and a forgotten expense. The ATO accepts paper and electronic records, provided they support the claims made. Work-related records generally need to be retained for five years from the date the return is lodged, although some investment and capital gains tax records may need to be retained longer.
Before you lodge, use a final review process:
- compare pre-filled income with your own statements and records;
- confirm every deduction was paid by you and was not reimbursed;
- check that private use has been excluded or fairly apportioned;
- make sure business and rental income has not been overlooked;
- review capital gains tax events, including asset sales and investment disposals;
- confirm supporting documents are saved and easy to retrieve; and
- pause before lodging if an amount is based on an estimate you cannot explain.
Consider a generic example. A salaried project manager works from home regularly, pays professional membership fees, completes a course directly related to their current role, and has a small portfolio of investments. Instead of claiming a broad estimate for “office costs”, they keep a record of actual home-working hours, retain invoices for eligible work expenses, check their investment statements against pre-fill data, and confirm whether the course has the required connection to their present employment. The result is a return built on supportable claims rather than guesswork.
A careful return is the best way to protect your refund
Maximising your refund is not about claiming more than you are entitled to. It is about claiming what is legitimately available, reporting all income correctly, and keeping evidence that supports each position. For many Australians, the key opportunities are found in accurate work-related claims, well-documented working-from-home expenses, properly managed investment and rental property records, and careful handling of superannuation contributions.
If your income includes contracting, rental property, investments, capital gains, side-business activities or significant deductions, a conversation with Ample Finance can help you understand the issues relevant to your circumstances and prepare with confidence.
General information only. This article is not personal financial or tax advice. Tax outcomes depend on your individual circumstances, so speak with a registered tax agent or accountant, such as Ample Finance, before acting on information that may affect your tax return.