Tax time is just around the corner in Australia.

While many Aussies are looking forward to a little extra cash in their pockets, the Australian Taxation Office (ATO) has been keeping a close eye on what taxpayers are claiming this year.


The ATO recently released its annual 'hit list' of claims and behaviours that will be under scrutiny for the 2023-24 tax year.

Some of these claims include work-related expenses, working-from-home (WFH) deductions, and undeclared income from second jobs or side gigs.

ATO Assistant Commissioner Rob Thomson stated that while most people do the right thing, there are few taxpayers who try to push the boundaries.


Last year, the ATO saw some truly 'outrageous' claims.

One taxpayer tried to claim a haircut as a work expense after getting headshots at a conference.

On the other hand, a truck driver wanted to claim a pair of swimmers for a lunchtime dip at a highway pool.

Meanwhile, a fashion industry worker attempted to claim $10,000 in luxury clothing to look 'well presented' at work.

Lastly, a real estate agent tried to claim over $30,000 for new veneers.


Two-thirds of Aussies who lodged a tax return last year included work-related expenses.

While taxpayers are entitled to claim legitimate deductions, the ATO warned everyone that if their claim does not 'pass the pub test', it won't pass their scrutiny either.

The ATO indicated that there should be a clear connection between the expense and the person's income-earning activities.

Proper records, such as receipts or invoices, should be kept to back up claims.

Lastly, taxpayers should not claim expenses already reimbursed by employers.

With more Australians working from home, the ATO also updated its guidelines for work-from-home deductions.


Taxpayers can no longer just estimate their expenses or use a 'shortcut' method.

Instead, remote employees need to keep detailed records of their working hours and the actual costs incurred.

The ATO is also keeping an eye on Aussies who have side hustles or part-time work.

Finder research shows that nearly one million Aussies have a second job to help make ends meet.

The ATO has been paying close attention to undeclared income from these sources, as well as from online platforms such as eBay, Uber, and Airbnb.

If the ATO spots a dodgy claim, they may ask people to pay the money back, along with an interest fee and penalties.

Severe cases of these claims may also lead to prosecution.


So, how can Aussies stay on the right side of the ATO?

• Only claim what you're entitled to. If in doubt, always check with a registered tax agent.
• Keep all receipts and records for at least five years.
• Be honest about your income, including side gigs and online sales.
• Use the ATO's online tools and calculators to help work out deductions.

Seniors, however, may have unique circumstances, so here are a few extra tips:

• Check if you're eligible for the Seniors and Pensioners Tax Offset (SAPTO).
• If you're doing volunteer work, remember that most out-of-pocket expenses are not deductible unless reimbursed.
• For those who downsized their homes, seniors may make a downsizer contribution to their super.

When in doubt, it's always best to check with a registered tax agent or visit the ATO website for the latest information and updates about tax returns.
Have you ever had a tax claim knocked back by the ATO? Do you have any tips for making tax time less stressful? Share your experiences and questions in the comments below!