If you are one of the lucky people who got their hands on a packet of Rapid Antigen Tests recently, keep the receipt because they may be tax deductible. The same goes for travel costs if you recently spent hours lining up at a drive-through PCR test clinic, and for N95 masks if you are required to cover your face at work. While one-off Covid expenses may seem negligible on their own, after two years of purchasing sanitiser and gloves, the costs begin to add up.
“There are lots of Covid-related expenses that can be claimed by workers as part of their tax refund”.
What You Can Claim
Gloves, face masks, sanitiser and antibacterial wipes can all potentially be claimed as work expenses if you are in an occupation with customer-facing contact. That could include people working in healthcare, retail, hospitality, teaching, beauty and hairdressing.
For example, with face masks and so on, it’s a case of do you feel secure? Is it likely you need one of those items to fulfil your duties? That’s what makes it deductible.
Expenses related to Covid tests can also be claimed as long as your employer told you to get the test. It needs to be at the employer’s instigation. For example, if you are obliged to get a PCR test, absolutely any cost associated with that, such as travel expenses will be deductible.
Separately, anyone who has had to quarantine while travelling interstate for work may also have expenses they can claim. That counts as work-related travel, so any expenses associated with quarantine are deductible.
If you are quarantining for some private purpose – for example, returning to work after a holiday, that is not deductible.
How to do it
If you intend to claim a Covid-related expense at tax time, you will need proof of the cost incurred. While you won’t have to submit this with your tax forms, you must be able to produce evidence if you are asked by the Australian Taxation Office.
In this case it would be a receipt or invoice to prove you did incur the expense. But if you are reimbursed by your employer, you can’t claim the tax deduction – it needs to be out of your own pocket.
If you would like to know further, please contact us by sending us an email, or via phoning on 03 9888 3175. If you are a business owner and would like to know if the tests are claimable, here is a recent article explaining the situation.