How to help clients avoid tax-time trip-wires

In this week's Accountants Daily podcast, ATO Assistant Commissioner Tim Loh talks tax agents through the fine print on pandemic deductions, work-from-home claims, rentals, crypto and granny flats. When it comes to COVID tests, the rules have changed to make them claimable for the first time. "Taxpayers who've paid for a COVID 19 test for work-related purposes – such as, for example, working out whether you can attend or remain at work – can actually claim a deduction for the COVID-19 test. So that could be a PCR test or RAT (rapid antigen test)," Mr Loh says. "There are a few conditions that you need to satisfy. You must have spent the money and not be reimbursed by the employer. The client must have used it for work-related purposes, so if the client bought the rapid antigen test to work out if they can go on a holiday to Byron Bay with their mates, that's not going to be a deductible expense. "And finally, you need a record for it. So receipts are best, and also digital invoices would be a really good record to have to support your claim." "A question that always comes up in relation to your children is when they have to use a test to work out whether they can go [to] childcare or school. That's not deductible, because it's not directly related to your income."