Taxpayers who paid for a COVID-19 test for work-related purposes or bought their own PPE could be able to claim it as a deduction, the Australian Tax Office says.
With the end of the financial year looming, the ATO expects COVID-19 will continue to impact tax returns.
“We know that many have faced significant challenges,” Assistant Commissioner Tim Loh said.
While taxpayers embraced working from home with gusto during the pandemic, many are now trying to determine what they can claim as a legitimate work expense on their annual returns.
From July 1, people forced to buy COVID-19 tests to determine if they can attend or remain at work can now claim the cost as a tax deduction.
They must have a record proving they paid for the test but the ATO will accept a bank or credit card statement alongside documentation from employers as evidence.
The ATO says employees cannot claim for tests supplied by employers or where the cost was reimbursed.
Only tests required for work-related purposes are deductible.
“If you purchased a COVID-19 test for a trip with your mates, you can’t claim a deduction,” Mr Loh said.
Taxpayers will also be able to claim deductions for the cost of protective items that protect against illness or injury while at work.
“If you’re spending your working day in close proximity to customers and at risk of contracting COVID-19, you may be able to claim a deduction for protective items such as gloves, face masks, or sanitiser.”
The federal COVID-19 disaster payment will not be taxed and does not need to be included in returns.
JobSeeker and Pandemic Leave Disaster payments are taxable and do need to be included.
Australia reported more than 23,000 new COVID-19 cases on Sunday, along with 30 virus-related deaths.
There are currently more than 244,000 active cases across the country, with around 2700 patients in hospitals.