Today's question we are answering is: "My business is in the health and wellness industry, can I claim gym clothes as a tax deduction?"
This is a great question, becauase we get asked similar version's of this question ALL the time. Often people will say that 'my mate told me he claims this, or my brother said I should be able to claim that'.
People actually claim all sorts of things as tax deductions, but if they get audited and caught out, they will regret it.
The main thing to be very careful of with this sort of 'advice', is that everyone's situation is very different, and what is OK for one person, won't necessarily be for the next.
So, in saying that, with expenses that you want to claim a tax deduction for, the expense HAS to be required for you to generate income.
In regards to clothes the ATO is pretty specific that it has to be 'occupation specific', 'protective clothing' or a 'uniform'.
By occupation specific, they are referring to clothes specific for your occupation, and not general by nature. Something that makes the clothes recognisable to your industry - like the checkered pants that Chef's wear.
Protective clothing includes anything that protects you from risk of injury or illness posed by the job you are actually doing, and in the environment which you have to do the job. Examples are safety vests, steel-capped boots, overalls etc. Ordinary clothes like jeans aren't considered protective as they lack actual 'protective qualilties'.
The other one is work uniforms. You can claim the cost of work uniform - whether it is compulsory or not - if it's unique and distinctive to your organisation. A uniform is unique if it has been specifically designed for the Employer, and it's distincitve if it has the company logo permanately attached.
Soooo, going back to the question, even if you are in the health and wellness industry, and it's important to stay fit and healthy as part of your image and brand, the gym clothes don't fit into these categories specified by the ATO. We certainly wouldn't be suggesting to try and claim a tax deduction for them.
As we initially mentioned, everyone's sitution and position is different, so please contact us to discuss further.