Top tax tips for teachers 2021
29 Jun 2021
It's that time of year again! The financial year is nearly over, and it’s time to collect your receipts and lodge your tax return.
If you lodge your own tax return, you must do so by 31 October 2021.
If you use the services of tax agent or accountant, you have until 15 May 2022 to lodge, so long as you’re up to date with prior year lodgements.
To help you understand what tax deductions you may be able to claim on your personal tax return, we’re sharing some of JSA Accounting’s top tax tips for educators. JSA Accounting and Edcom Taxation Services is a local Adelaide firm with offices at Reynella and Hindmarsh.
If you claim car expenses using the cents per kilometre method, you don’t always need written evidence such as receipts or a logbook. Usually you can just multiply the business kilometres you travelled by the Australian Taxation Office (ATO) rates and you should be good to go.
Also, the ATO has increased their cents per km rate this year – so you’ll get more bang for your buck!
|Travel you can include||Don’t include|
Excursions and camps
Travel to and from your own school
Professional development days and conferences
Trips to social functions
Travelling to other schools and offsite events
Any car expenses if your car is leased via salary sacrifice
You can claim relevant public transport fees, taxi costs and airfares but make sure you keep your receipts.
- Home to work travel is only claimable in limited circumstances such as if you’re carrying bulky or heavy items to school (i.e. musical instruments, woodwork tools).
Home Ofﬁce Expenses
Most teachers work from home to ﬁnish marking, plan lessons and write reports. This means you’re able to claim the cost of electricity, gas and furniture. You can do this either by claiming a percentage of actual costs or by using a ﬁxed rate of 52 cents per hour, or 80 cents per hour under the COVID-19 short-cut method.
You just need to prove the hours worked at home by keeping a diary representative of a four-week period.
Claiming a deduction
|You can claim a deduction for…||You can’t claim a deduction for…|
Phone and internet use in relation to your work
Social functions and staff association fees
First aid course (if you’re a designated ﬁrst aid person at your school)
Student expenses or gifts unrelated to curriculum
Sunglasses and sun protection for outdoor work like yard duty, physical education etc.
Excursion and camp expenses
Most fitness equipment even if you teach Physical Education
Teacher registration – claimable every three years
Top deductions teachers should be claiming
- Teacher registration – claimable every three years
- Union fees
- Travel and car costs
- Home ofﬁce expenses
- Classroom supplies and teaching aids including art materials, stickers, prizes etc.
- Items used in cooking or sewing classes or science experiments
- Textbooks (used as a resource)
- Self-education costs
- Conference, seminar or workshop fees
- Memberships and subscriptions speciﬁc to what you teach
- Income Protection Insurance
- Calculator, whistle, and stopwatch
- Entrance fees to school excursions
You can usually claim the cost of work clothing (including shirts, pants, skirts, jackets, jumpers – provided each item has the school’s logo on it) and the cost of washing or dry cleaning your work clothing.
Work tools and equipment
You can usually claim the cost of buying and repairing equipment you use at work, including tools, musical instruments, electronic organisers, laptop computers and mobile phones. Just make sure you keep all your receipts.
Overseas travel – conferences, study tours and sabbaticals
Travel expenses associated with an overseas conference, sabbatical, course or study tour will generally be deducible to the extent to which they achieve the following objectives:
- They enable you to become more proficient in carrying out your current income earning activities.
- They objectively lead to (or are likely to lead to) an increase in your income (i.e. the activity would assist in being promoted to a higher level).
If you want to claim expenses associated with travel in relation to teaching, you need to be aware of the following information the ATO will want to obtain in the event of an audit:
- A travel diary - is often required and always recommended.
- Employer Letter – a letter from your employer stating whether the trip was undertaken at their direction (or with consent), and the purpose of the trip. The letter should include details of any allowances, grants or reimbursement received in connection with the trip.
- Beneﬁt of the work trip – you’ll need to establish that the knowledge and experience gained from the trip enabled you to become more proﬁcient in carrying out your current work duties.
- Qualifications – include any addition qualifications you received on the trip.
- Trip itinerary – record details such as a description of each place you visited, activities undertaken and how it relates to your work. This should include an approximation of time spent in each place, amount of expenses incurred at each place, and proportion of time devoted to activities unrelated to work.
- Work related report –record whether you’re expected or required to prepare a written or oral report for the trip, for your employer or other colleagues.
- Taxpayer’s records – the ATO will want to see records from which the amount claimed has been calculated i.e. written evidence or receipts for expenses, and a travel diary which sets out details of activities undertaken.
Work related travel during COVID-19 period
The ATO is expecting work related travel claims to be significantly less this year given the interstate and overseas travel restrictions. If you’re claiming travel expenses similar to previous years, make sure you’re able to provide evidence of these expenses as you could be audited.
Other general expenses
- There are some tax deductions that all employees can claim on their personal tax returns, including:
- the amount of any donations to registered charities (as long as you haven’t received anything in return for your donation, such as raffle tickets or novelty items)
- the cost of bank fees charged on any investment accounts,
- your tax agent fees (the amount you pay to your accountant to prepare your tax return each year), and
- the cost of travelling to see your tax agent (you can claim the cost of travelling to see your accountant to have your tax return prepared. You should keep a record of the number of kilometres you travel and any other incidental costs such as parking, meals, accommodation etc.).
It's important that you keep receipts for all purchases that are work related, even if they’re not listed above. That way, when it comes to preparing your tax return it’s easier to decide whether you can claim a tax deduction for them or not.
If you would like more information, the ATO produces a free publication to assist teachers to prepare their tax return, it is called ‘Teachers’ and a new version is released each year. Visit the ATO website and enter ‘Teachers’ in the search box at the top of the screen. You can also visit the JSA Accounting website for a teacher fact sheet.
This is general advice only and doesn't take into account your objectives, financial situation or needs. Credit Union SA has received permission from Personal Tax Specialists to provide this information. It does not have a relationship with Personal Tax Specialists. The information provided is to be used as a guide only and Credit Union SA does not endorse any of the information provided nor does it endorse Personal Tax Specialists as a provider of taxation advice. You will need to consult with a registered tax agent before acting on the material provided.