What does tax deductible mean?

• A general principle of tax in Australia is that costs necessarily incurred in earning income are tax deductible.
• The tax law allows taxpayers to claim (deduct) certain costs or expenses directly related to earning assessable income. This includes:
  • the costs of borrowing money for investment provided the investment has been made to produce assessable income;
  • vehicle and travel costs if you travel between your primary workplace and another workplace;
  • purchase and cleaning costs for occupation specific or necessary protective clothing;
  • self education expenses; and
  • tools, equipment or other assets purchased to help you earn income.