Construction Worker Tax Deduction Checklist

The income tax rates in Australia are progressive, which means that the higher your earnings are, the higher percentage you pay. Same rules apply to construction worker. It is imperative to know the tax deductions that you are eligible for to minimise your tax bill. Let us take a look at some of the common deductions for construction workers.

1. Uniforms

The clothing you wear to work is tax-deductible so long as it is specific to your job and the nature of the business. If you’re a bricklayer, this would include things like boots, gloves, overalls, hats and safety gear such as hard hats, goggles and earplugs. For those who work in the sanitation industry, this would include such things as protective gloves and boots. You can get more tax deductions for your uniforms if they are made from a special fabric that is flame-resistant or waterproof.

2. Safety equipment

The safety gear you need to wear while on the job may also be included in the list of tax deductions that you can claim. The first thing that comes to mind is a hard hat but you should also take into consideration other safety equipment such as goggles, gloves and earplugs. For those who work with power tools, there are also other items that should be included in the list of tax deductions for construction workers. These include things like protective screens or goggles when working with certain equipment.

3. Tools and equipment 

The tools you need for your work are not necessarily included in the list of tax deductions but since they will have to be replaced every so often, they can become a valid deduction on your taxes. This also includes items such as a toolbox, a briefcase or a bag. It also includes protective clothing and safety equipment you have to use for your job.

4. Car expenses 

You can also claim tax deductions for the use of your car if you use it to drive to and from job sites or meet with clients, suppliers and other business associates. The first thing that comes to mind is fuel costs but this also includes tolls, parking fees, insurance and depreciation. Keep in mind that you need to have kept an accurate logbook of your trips throughout the year so that you can have an accurate figure for what you owe on taxes.

Important Documents for Claiming Tax Deductions for Construction Workers

These are some of the common tax deductions for construction workers in Australia. To claim these exemptions, you need to have the right documents so here’s what you need to know:

1. Accurate logbooks 

If you use your car for work purposes, it is important that you keep an accurate logbook all throughout the year. This means that you need to record all of your trips, the distance covered and any expenses along the way. If you do not have one, you could end up having to pay more on taxes because of this.

2. Itemized invoices 

For work-related items such as tools and uniforms, make sure that you have itemized invoices to show exactly what you bought and how much each one cost. If you do not, you could end up paying more than what these items are actually worth which is something that you should avoid.

3. Employment contract 

If your employer requires or encourages you to wear work uniforms or safety equipment, make sure that there is a written contract to go along with this or else you could be taxed for it. If possible, try to have the contract signed by both parties before the start of your employment.

Accurate Business & Accounting Services is always ready to help you with the computation and filing of your annual tax returns. If you are construction worker, talk to us and learn more about the right tax deductions.