Agricultural Workers Tax Return and Deduction Checklist
You work incredibly hard tilling the earth and managing cattle and livestock, so the last thing you probably want to think about at the end of a long day is your taxes. But you need to! Managing your taxes correctly and efficiently is one of the smartest things you could do – and it's easier than you might think.
The key to success is keeping track of all your expenses, so you can make every possible deduction in your annual tax return and get a bigger refund at the end of the day. We've put together a checklist below of common agricultural worker deductions to get you started, but the best approach is to get some expert help. Our tax consultants here at H&R Block live and breathe taxes everyday and they can help you get a better result and make sure you don't miss out on a thing.
To complete your return as an agricultural worker employed by a company, you'll first need an income statement from your employer (previously called a "payment summary" or "group certificate"). This is a summary that outlines all your salary, wages, allowances and bonuses for the financial year.
You won't need to have a copy of this statement, as it should be lodged by your employer directly to the ATO. Once this has been lodged, we can download the information for you and then help you work out your deductions.
What do I need to know about claiming deductions?
As you know, you're entitled to claim deductions on any money spent during the financial year on products or services that directly related to earning an income. But there are two things you need to remember:
- First, you need to have spent the money yourself (it can't have been reimbursed by your employer), and
- Secondly, you need to keep a record of the expense such as a receipt or invoice.
What deductions can I claim?
There is a wide range of deductions you can claim as an agricultural worker, such as:
- Any costs related to the purchase and running costs (such as fuel, oil and repairs/maintenance) of an all-terrain or utility vehicle like a quad bike, if it's used to cover large distances of land not accessible by car
- Car expenses, including parking costs and tolls, if you travel between different jobs on the same day (for example from your day job as a fruit picker to a second job working in a warehouse) or to different locations for your work, such as between different fields owned by your employer, or need to transport heavy/bulky equipment or tools that can't be securely stored on the work site
- Any expenses covered by award transport payments, but only if the expenses are for deductible work-related travel
- Any costs incurred when buying and looking after any working animals, such as a dog or horse, including vet bills, registration costs and food, but only if you are working with cattle or livestock and need assistance herding them, or it's a requirement of your job to provide your own working animal
- Any expenses connect to buying, repairing and cleaning any work clothing items that are either part of a uniform or distinctive to your company (such as a shirt with a company logo on it) or are distinctive to your job, such as a sheep shearer wearing clothing that repels lanolin and shearers' moccasins, or have protective benefits such as gloves, UPF 50 work shirts, steel-capped boots, sunhat or sunglasses (including prescription sunglasses and anti-glare glasses)
- Any costs connected to the buying and maintenance of firearms, including renewing your gun licence, but only if they are specifically connected to your job as an agricultural worker (for example, a gun that is used to control vermin on the farm)
- The cost of a first aid training course if you're a designated first aid person on the farm or work site and need to do first aid training to assist in emergency work situations
- Any expenses related to buying, hiring and insuring equipment or tools specifically required for your work
- The cost of renewing a special driver's licence or getting a special condition on your licence or certificate in order to perform your work duties, such as a forklift licence or heavy vehicle permit, but not the initial cost of getting these items
- Overtime meals when your employer pays you an overtime meal allowance under an industrial law, award or agreement
- Phone and internet expenses for any work-related usage on your personal phone or device, provided they are not already covered by your employer
- Self education costs for attending any courses, training or seminars specifically related to progressing you in your current line of work, such as a Diploma in Agriculture
- Journals, periodicals and magazines that are specifically related to your job as an agricultural worker
- Travel expenses such as accommodation and meals if you travel for work and need to stay away from home overnight (for example, if you need to move cattle over a long distance between farms) and pay these expenses yourself
- Any union and professional association fees
What can't I claim?
There are several key expenses you can't claim, including:
- Any regular clothing worn to your workplace that could also be worn outside of work (such as shorts, ordinary work shirts or running shs) even if you only wear it for work and bought it specifically to wear to work
- The cost of getting and renewing your driver's licence, even if having it is a condition of your employment
- Any expenses related to childcare while you're working
- The cost of any meals or snacks consumed during the course of a normal work day, even if you are given an allowance by your employer to cover the meal expense
- Self education costs for attending any courses, training or seminars designed to help you to get work in a new area, for example if you are currently working on a dairy farm but studying nursing at night for a new career
- Any costs incurred when travelling between your home and your workplace, even if you live a long distance away
What records do I need to keep?
All of them! It's really important at tax time to be on top of your receipts and have a comprehensive set of records if you want to get a good tax refund. It's a smart idea to create an easy and reliable system to help you keep on top of this throughout the year.
Remember, you don't need to keep physical receipts, and it's acceptable to keep a digital copy (such as a photo of a receipt or an email receipt) provided it is possible to read:
- The name of the supplier
- Amount of the expense
- Nature of the goods or services
- Date the expense was paid
- Date of the document
You also don't need to keep receipts for expenses under $10 (as long as these don't cumulatively come to more than $200).
What happens if I make a mistake in my tax return?
It's okay, we know this can happen to anyone and strongly recommend dealing with it as soon as possible. This is always the best approach. It's essential that you take great care in putting together the information and supporting documentation when filing your tax return, and only claim deductions that are genuine to avoid penalties and possibly even prosecution from the ATO.
It's easy to make an innocent mistakes sometimes, and if you lodge yourself and realise you've submitted incorrect or unsubstantiated claims then you should contact H&R Block immediately and we will assist you in making the necessary amendments.
Still have some questions about lodging your tax return? Talk to H&R Block. Our experienced tax consultants will be able to help. Call 13 23 25 for details or find your nearest office and book an appointment online.
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