Professional Sportsperson Tax Return and Deduction Checklist
As a professional sportsperson, you know better than anyone the importance of preparation and being consistent if you want to get a good result. It's true on the track, court or field – and it's true when it comes to doing your taxes!
If you don't think about your taxes in an advance of the end of the financial year, you could be in for a nasty surprise and might end up missing out on money you deserve. Plan ahead and keep records for everything, and you'll definitely be ahead of the game. It's also a good idea to get some expert help from one of our experienced tax consultants here at H&R Block, who can help coach you through the process and make sure you don't miss any deductions.
To complete your return as a professional sportsperson employed by a company, club or organisation, 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 of 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 your income. But there are two things you need to remember:
1. First, you need to have spent the money yourself (it can't have been reimbursed by your employer), and
2. 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 a professional sportsperson, such as:
- Car expenses, including parking costs and tolls, if you travel between different locations for your work (for example from the team training grounds to the stadium for a match) or if you need to transport heavy pieces of equipment that are necessary for training and can't be safely left at the workplace
- Any expenses connected to buying, repairing and cleaning any clothing items that are either part of your team uniform or distinctive to your club or organisation (such as a shirt or a cap with a club emblem or logo on it)
- Any clothing or items that have protective benefits such as a headgear, mouthguards, anti-glare glasses, sports skins and sun protection clothing including sun glasses and sun hat
- Health and fitness expenses such as gym membership fees if they are connected to maintaining the high level of fitness required for your job, but not any costs related to weight loss or dietary issues including vitamins, minerals or supplements
- Income or loss of work insurance and professional indemnity insurance
- Fines and penalties for on-field conduct and legal expenses, including those relating to a tribunal decision, if they result from your performance as a player and are part of the sporting activity
- Luggage such as overnight or trolley bags, if they are used for travel to a game, competition or professional appearance
- Player manager fees, if the costs are accrued due to the settling, renegotiating or renewing of an existing contract, or possibly the negotiation of a new contract
- Professional association fees
- Any expenses related to buying and insuring equipment specifically required for your work, such as pieces of sports equipment or resistance bands, or any training and research material used as part of your official training plan
- Self education costs for attending any courses, training or seminars specifically related to your current line of work, such as a training course focused on physical endurance that you attend to make you better at your job
- Phone and internet expenses for any work-related usage on your personal phone or device, provided they are not already covered by your employer
- Travel expenses such as accommodation and meals if you travel for work and need to stay away from home overnight (for example, if you a playing a match interstate) and pay these expenses yourself
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 workout gear including sweatpants, jogging shs, shorts or t-shirts) even if you only wear it for training and bought it specifically to wear to training
- Any childcare costs, even if it is on match days or during a competition
- Any fines, penalties and legal expenses for off-field breaches of conduct
- Any general medical expenses or travel insurance
- 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
- Any grooming costs, including hairdressing services and buying items of make up, even if it's a requirement of your job to be well presented
- 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?
Record-keeping might seem boring, but it's really important at tax time, so you need to stay on top of your receipts and have a comprehensive set receipts 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?
First of all, keep a cool head. We know this can happen to anyone and strongly recommend dealing with it as soon as possible. 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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