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Sneaky ATO deduction that could land you in hot water

Tax time is in full-swing and Aussies have been warned not to try and claim these deductions.

Tamika Seeto
·Finance Reporter
Updated ·2-min read
ATO and people
Tax time is here and the ATO is reminding people not to make incorrect claims. (Source: ATO/Getty)

The Australian Taxation Office (ATO) is warning Aussies not to try and make a sneaky claim for their makeup on their tax return. It’s one of the most common deductions that Aussies mistakenly think they can claim.

As a general rule, you can’t claim the costs of personal grooming or cosmetics. That includes things like cosmetics or makeup, skincare, shaving products, haircuts or hair products.

“Your personal appearance and grooming products are private expenses. This is even if your employer expects you to maintain a certain standard of grooming or appearance,” the ATO said.

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“There are exceptions in very limited circumstances – for example, a performing artist requiring stage makeup.”

You can claim a deduction for sunscreen if your work requires you to be outdoors for prolonged periods of time. The ATO notes that some creams and cosmetics can function as both sun protection and as a cosmetic.

“Remember – you can only claim for the work-related use of these products,” the ATO said.

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H&R Block director of tax communications Mark Chapman told Yahoo Finance that makeup was one of the most common things people wrongly tried to claim each year.

The general rule is that if you incur the expense as part of your job and haven’t been reimbursed, you can make a claim, he said. You’ll also need to prove you spent the money through an invoice, receipt or other proof of purchase.

“If you tick all those boxes, you should be OK. Having said that, there are a few things that people often try to claim as deductions that are never – or at least very rarely – deductible, even though taxpayers often swear blind that they are entitled to make a claim,” Chapman said.

Here are some common deductions you generally won’t be able to get away with:

  • Child care

  • Gym memberships

  • Business suits

  • Home to work travel

  • Pay-TV subscriptions

  • Sporting club memberships

  • Entertainment

  • Medical costs

The ATO has occupation guides you can check to see what you can and can’t claim. Mark Chapman has also written a handy guide to the best deductions available here.

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