ATO and tax experts reveal most ‘outrageous' things Aussies have tried to claim back
tax
office.
Ahead of the 2025 tax period, Australia's revenue collection agency has signalled what it will be cracking down on this year while warning exaggerated deduction attempts 'would not be tolerated'.
Among the 'most outrageous' work-related deduction attempts the Australian Taxation Office (ATO) received last year was a truck driver who tried to claim swimwear because they had stopped in a hot place and needed a swim, and an unnamed fashion industry manager who wanted to be reimbursed more than $10,000 they spent on luxury clothing bought to attend dinners and other functions.
A third example shared by the ATO was of a mechanic who tried to claim gaming consoles, a TV, an air fryer and vacuum cleaners as work-related expenses.
All claims were denied.
'While some people have tried their luck with unusual work-related deduction claims, most people realise to be able to claim an expense it needs to meet strict criteria,' ATO Assistant Commissioner Rob Thomson said.
'While a lunchtime dip might clear your head for work, swimwear for a truck driver is clearly not deductible.
'We know in many instances mistakes relating to work-related expenses could be avoided with a little time and effort.'
The 'revealing' length some Australians are willing to stretch the truth if they can score a tax break was also identified when Chartered Accountants ANZ (CA ANZ) surveyed 180 tax experts.
One taxpayer tried to claim a luxury yacht as a work expense because 'they might have some business to do' on some islands, while another wanted to be paid back for monthly salon trims because their 'hair grows during business hours'.
'There were many dubious claims related to health, wellness and personal aesthetic, including one for the cost of a gym membership as the individual needed to be strong and fit to renovate their rental property,' CA ANZ tax lead Susan Franks said.
'Another related to a Pilates reformer machine purchased to help an office worker who had a sore back.
'We also noticed a trend of big-ticket luxury purchases passed off as business and work expenses, including one who tried to claim a family trip to a tropical island was related to their earthmoving business.'
Other taxpayers tried to claim vet and food bills for their pets, a pool, school fees and an engagement ring.
Franks said the attempts were cheeky but discouraged people from making fraudulent claims 'because the ATO will not be laughing'.
The tax office said work-related expenses, working from home deductions and side hustles would be in the microscope this year, claiming these are areas that produce 'frequent errors'.
More than 10 million people claimed work-related deductions in 2024, and many lodged expenses relating to working from home.
'Work-related expenses must have a close connection to your income earning activities and you should be prepared to back it up with records like a receipt or invoice,' Thomson said.
'If your deductions don't pass the 'pub test', it's highly unlikely your claim would meet the ATO's strict criteria.
The advice for taxpayers is to check the ATO website and to consider using its app where expense records can be stored and later shared with your tax agent or uploaded to myTax when lodging your return.
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