Fly In Fly Out Worker Tax Deductions
Fly-In Fly-Out (FIFO) workers are subject to special tax rules and deductions. Here are a few highlights.
Working remotely - zone tax offset
You may be eligible for a 'zone tax offset' if you live in a remote or isolated area of Australia (but not an offshore oil or gas rig) for at least half of the tax year. These offsets compensate individuals living in remote locations because of their isolation, uncongenial climate, and high living expenses.
Since 1 July 2015, fly-in and drive-in drive-out workers have been excluded from the zone tax offset where their normal residence is not within a zone.
To be eligible for the zone tax offset, a taxpayer must reside in a specified remote area for more than 183 days in an income year.
Those FIFO workers whose normal residence is in one zone but who work in a different zone will retain the zone tax offset entitlement associated with their normal place of residence.
Residents of Australia are taxed on their worldwide income, so they are still subject to Australian tax law even if they fly into a foreign site. Additionally, you should consider the tax laws of the foreign country. Each individual's situation is unique, and we can help you determine how an Australian tax law applies to you.
If you are based in Australia but work overseas, the cost of your visa, vaccinations etc., should be deductible to the extent they relate to your work.
Phone and internet
Work-related phone calls, plus line and handset rental, can be claimed if you are on call or must contact your employer while away from your workplace. It will be necessary to divide these costs between work and private use. It may be possible to claim a split of your internet fees if you do some online training from home or need to be available via email.
FIFO arrangements prohibit you from claiming travel expenses between your home and the departure spot (for example, an airport) nominated by your employer. Additionally, you cannot claim relocation expenses if you have to move closer to a new job.
You can claim a deduction for the cost of your luggage if you frequently travel for work, including travel bags, overnight bags, suit packs, suitcases, and luggage trolleys. However, an item or set of luggage that costs more than $300 is only deductible for depreciation, not for the entire cost.
Clothing items that relate solely or primarily to your work or the environment in which you work can be deducted. For example, the cost of mandatory uniforms and protective gear (e.g. overalls, steel-capped boots) can be claimed. You can also claim on laundering uniforms and protective clothes.
You can claim a deduction for other equipment your employer might not provide (e.g. gloves, goggles, masks, rubber boots, winter jackets).
Medical examinations and testing
If you require a medical examination or drug or alcohol test for your work, the cost of obtaining these should be deductible.
Pre-vocational courses (such as Certificate II in Coal Mining) cannot be claimed. However, expenses for short periods, university courses, and TAFE courses relating to your current work can be claimed if they are not reimbursed otherwise.
You may be able to deduct travel, meals, and accommodation costs if you attend seminars or courses away from your workplace.
Tools and equipment
You can claim an immediate deduction for tools or equipment that cost less than $300. Each year, you can only claim the decline in value if they cost more than $300. You can also claim (either immediately or over several years) the cost of organisers, laptops, tablets, mobile phones and GPS units, plus the cases you use to carry them around. Work-related books, magazines and journals should also be deductible.
Licences and tickets
The cost of renewing a special license, rather than obtaining the original one, would be deductible if necessary, in your current job.
Maintain good records of work-related expenses and activities. Keep receipts, invoices, bank statements and credit card statements in paper or electronic form. Keep records anyway if you need clarification on whether something is deductible, and let us decide when you come in.
Thank you for reading!
Should you have any queries in regards to the above please contact our office on (03) 9728 1448
The TAS Team
3/653 Mountain Highway, Bayswater VIC 3153
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