Your FY2026 Guide to Maximising Individual Tax Deductions

Individuals – Key Tax Deductions & Considerations for FY2026

As we approach 30 June, now is the time to review your position and ensure you are maximising available deductions while remaining compliant with current ATO requirements.

Below is a summary of key areas to consider for the 2026 financial year.

 

Working From Home Expenses

There are two methods available to claim working from home expenses.

Fixed Rate Method – 70 cents per hour

  • Rate: 70 cents per hour for FY2026
  • Covers:
    • Electricity and gas
    • Internet and data
    • Phone usage
    • Stationery and consumables

Additional claims available separately:

  • Decline in value of office equipment (e.g. laptops, desks)
  • Repairs and maintenance
  • Cleaning (where there is a dedicated home office)

Requirements:

  • Record of actual hours worked from home across the year
  • Evidence that you incurred the relevant expenses

Actual Cost Method

Allows you to claim the work-related portion of actual expenses, including:

  • Utilities
  • Internet and phone
  • Office consumables
  • Equipment depreciation
  • Cleaning (dedicated office only)

This method requires more detailed record keeping and calculations.

 

Motor Vehicle Expenses

Cents per Kilometre Method

  • 88 cents per kilometre for FY2026
  • Maximum of 5,000 kilometres per vehicle

Logbook Method

  • Claim based on actual expenses and work-related usage
  • Requires a valid 12-week logbook

 

Work-Related Travel

Deductible where directly related to earning your income, including:

  • Flights and accommodation
  • Taxi and ride share expenses
  • Parking and tolls

 

Clothing and Uniforms

Deductions may be available for:

  • Compulsory or branded uniforms
  • Occupation-specific clothing
  • Protective clothing

 

Self-Education Expenses

Deductible where the study relates to your current employment and helps maintain or improve your skills.

This may include:

  • Course fees
  • Textbooks and materials

 

Other Work-Related Expenses

  • Professional memberships and subscriptions
  • Union fees
  • Training courses and seminars
  • Licence fees

 

Investment-Related Deductions

Examples include:

  • Interest on funds borrowed to invest
  • Certain investment-related expenses

 

Donations

Donations are deductible where made to a registered Deductible Gift Recipient (DGR).

 

Accounting Fees and Insurance

  • Accounting and tax agent fees are deductible
  • Income protection insurance is deductible where held personally
    • Policies held within superannuation are not personally deductible

 

Superannuation Contributions

  • Concessional contributions cap: $30,000 for FY2026 (including employer contributions)

Unused contribution caps may be carried forward for up to five years, subject to eligibility.

To claim a deduction for personal contributions, a Notice of Intent to Claim must be lodged with your super fund before lodging your tax return or by 30 June 2027 (whichever occurs first).

 

Additional Considerations

Private Health Insurance

Ensure your policy details are accurate to avoid Medicare Levy Surcharge where applicable.

Medicare Levy Surcharge

May apply where income exceeds relevant thresholds and appropriate private health cover is not held.

Anticipated ATO Focus Areas

The ATO continues to focus on:

  • Working from home claims
  • Work-related expenses
  • Rental property deductions

 

Important Disclaimer

Each client’s position will vary depending on income, investments, business and structure. The above is general information only and does not constitute personal advice. Please contact us if you would like to discuss further prior to 30 June.