2023 Year End Tax Wrap for Individuals
KEY CHANGES
Removing the self-education expenses threshold
Before 1 July 2022, you were required to reduce your allowable work-related self-education expenses by $250 to calculate your deduction. The $250 non-deductible threshold has been removed for 2022-23.
You must continue to maintain records of your deductible self-education expenses.
Low and Middle Income Tax Offset
The low- and middle-income tax offset (LMITO) ended on 30 June 2022. It is not available from 2022–23. This is one of the key reasons you may receive a lower refund than expected or a tax bill this year.
The low income tax offset (LITO) is still available for taxpayers with a taxable income of $66,667 or less. It can provide a maximum offset of $700 depending on your taxable income.
Motor Vehicle
The cents per kilometre rate remains at 78 cents However, it is proposed that the rate at which deductions may be claimed for work related car expenses using the cents per kilometre method for the income year commencing 1 July 2023 will be 85 cents.
Working from Home
The fixed rate method for calculating your deduction for working from home expenses has been revised. The revised fixed rate method is 67 cents per work hour and available from 1 July 2022.
The fixed rate method has been revised to:
- increase the rate per work hour that you can claim when you work from home
- change the expenses the rate covers
- change the record keeping requirements
- remove the requirement to have a home office set aside for work.
You can also separately claim a deduction for the work-related use of depreciating assets such as office furniture and technology.
If you don’t use the revised fixed rate method, you need to use the actual costs method. You can no longer use the shortcut method.
Eligibility for downsizer contributions