Tax Return for Tradies – [Updated FY 2023-24] All You Need to Know

1. Tax Return for Tradies – [Updated FY 2023-24] All You Need to Know Safe & Secure Tradies are the backbone of hands-on expertise in Australia. When we talk about tradies, we mean carpenters, electricians, plumbers, mechanics, and all the other skilled professionals who work hard to get the job done right. Tradies are the ones building, fixing, and maintaining everything from structures to systems, using their specialized skills and hard-earned know-how. In Australia, there are certain ATO regulations for Tradies which everyone must follow. www.taxly.ai

2. Tax Return for Tradies – Key ATO FY 2023-24 Updates New fixed rate of 67 cents per hour, replacing previous rates, with stricter record-keeping for WFH Deductions. Expenses for tools related to the trade are still claimable. Deductions for work-related vehicle expenses (fuel, maintenance, insurance) remain applicable. You Can Claim Tax Deductions for Employee Tradies If: The expense must have been paid by the individual without reimbursement. The expense should be directly linked to earning income within the trade or job. www.taxly.ai

3. Work-from-Home Deductions: The previous 80-cents-per-hour and 52-cents-per-hour fixed rates for work-from-home deductions are replaced by a new fixed rate of 67 cents per hour. Vehicle Expenses: Let’s say you use your vehicle for work purposes as a tradie, and you’ve kept a logbook detailing your work-related mileage. Expenses such as fuel, maintenance, insurance, and even depreciation related to your work usage can be claimed. This can significantly reduce your tax bill. Work Related Travel Expenses: Deductions apply to actual expenses incurred during work-related travel. Public transport fares or accommodation expenses for overnight stays can be claimed based on receipts. www.taxly.ai

4. Small Business Tradies Tax Deductions (Sole Traders, Partnerships, Companies, Trusts): Protective Clothing or Items: Safety gear and equipment required for occupational health and safety standards in the business. Assets Purchased for Business Use: Immediate deductions under temporary full expenses for eligible assets bought within specified dates. Motor Vehicle Expenses: Fuel, maintenance, insurance, and repairs for vehicles used for business purposes. www.taxly.ai

5. Motor Vehicle Expenses: Fuel, maintenance, insurance, and repairs for vehicles used for business purposes. Other Allowable Expenses: Costs incurred directly in running the business, such as drop sheets, tools, insurance, and computer consumables. www.taxly.ai

6. Tax Offsets and Rebates for Tradies: With the end of the low and middle-income tax offset (LMITO) on June 30, 2022, tradies might notice changes in their refunds or tax bills. This could mean a potential reduction in the refund or an increased tax bill for some individuals compared to previous years. Do You Fall in the Tradie Category for Tax Return? If you’re wondering whether you fall into the “tradie” category in Australia, consider the nature of your work: Skilled Manual Work Are you engaged in a skilled trade that involves manual labor and specialized skills? This could include professions like carpentry, plumbing, electrical work, automotive mechanics, welding, painting, and similar hands-on roles. www.taxly.ai

7. Technical Expertise: Do you have specialized training, qualifications, or apprenticeship in a specific trade? Tradies typically possess technical expertise gained through formal training or on-the-job experience. Technical Expertise: Do you have specialized training, qualifications, or apprenticeship in a specific trade? Tradies typically possess technical expertise gained through formal training or on-the-job experience. Industry Involvement: Are you involved in industries such as construction, manufacturing, maintenance services, or similar fields that heavily rely on specialized tradespeople? www.taxly.ai

8. How Long to Keep Records? Retain all tax-related documents, including receipts, income statements, and expense records, for a minimum of five years after lodging the tax return. If claiming depreciation on assets or deductions related to business equipment, keep records for these assets for at least five years following the final claim. www.taxly.ai

9. The Bottomline Tradies return for tradies encompass various tax deductions. You can claim work-related expenses like tools, protective gear, and vehicle costs if they paid for these without reimbursement, keeping records to back up their claims. Employee tradies need expenses directly related to earning income, while small business tradies deduct costs necessary for conducting their business. Keeping accurate records and understanding eligible deductions are crucial for a successful tax return. www.taxly.ai

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