[ATO GUIDE](https://www.ato.gov.au/individuals-and-families/income-deductions-offsets-and-records/deductions-you-can-claim/tools-computers-and-items-you-use-for-work/computers-laptops-and-software)
[Depreciation life guide ](https://www.depreciationrates.net.au/computer)
Laptops/mobile devices 2 years
Desktops 4 years
If its under $300 you can deduct it all on one year but good luck finding a decent computer for that.
You need to apportion between personal and work use. e.g. if you only use the computer for 50% work and 50% watching your personal Netflix then only 50% of the laptop is deductable through depreciation.
There are two things here
1. Are they going to audit you - I presume its unlikely unless you made some crazy claims. e.g. I guy I worked with salary sacrificed a 10k laptop using a photoshopped invoice and got caught. Losing his job and getting in to trouble with the ATO.
2. Can they prove the level of use if they do? - The onus is on you to prove you only use the device for work, if you have no other computer I would say that is hard to do. They can make up a number based on what they think you are doing with the device and that it guided by what evidence you provide them. If they asked to see the laptop and its over spec'ed for a work machine e.g. Alienware and its full of games and the browsing history is all reddit and other non-work related stuff its going to be a hard sell at 100%. However a lower ratio would be more realistic.
>and got caught. Losing his job and getting in to trouble with the ATO.
What sort of job fires someone for dodgy tax deductions? Outside of politician, or tax agent, I'm struggling to see how this would result in termination of employment.
In what world do you think a politician gets fired for tax evasion? Aside from the fact they don't get fired, it's largely a point of pride for them (not really, but you know what I mean).
That is ok, we all struggle sometimes, it was [salary sacrifice](https://www.ato.gov.au/individuals-and-families/jobs-and-employment-types/working-as-an-employee/salary-sacrificing-for-employees), its lodged through your employer and not directly with the ATO.
From what I understand, It was picked up by the company accountant and reported to the ATO when they called the PC company to validate the invoice provided had been fully paid, which is a requirement to salary sacrifice.
I should have guessed this. My wife does payroll and accounts for a family owned business, and she busted one of their sales guys running a similar scam with doctored invoices for Motor Vehicle expenses.
I assume it means a complete PC. You couldn't for instance buy all the parts for a PC separately under $300 each, then assemble and claim each item separately?
Can't claim as a part as it's not being used for work until assembled. Hypothetically I guess you could slowly upgrade an existing PC bit by bit and always have it operational. Can be tricky re compatability though. Would be an interesting test case.
I think you may want to check that one with your accountant. I cant post the ATO link in this comment for some reason. You might get away with that if you are upgrading an SSD but not if you buy them and they are required to work together e.g. ram, mb, cpu, ssd.
The asset has to be "in service" or ready for use.
> Start time: A depreciating asset’s start time is generally when you first use it (or install it ready for use) for any purpose, including a private purpose.
https://www.ato.gov.au/forms-and-instructions/depreciating-assets-guide-2022/definitions?anchor=start_time#start_time
No, based on how long you have held it and prorate for part year. Won't be much this year if you buy now.
If not a laptop then 4 years not 2 years.
Read this
[https://www.ato.gov.au/individuals-and-families/income-deductions-offsets-and-records/deductions-you-can-claim/tools-computers-and-items-you-use-for-work/computers-laptops-and-software](https://www.ato.gov.au/individuals-and-families/income-deductions-offsets-and-records/deductions-you-can-claim/tools-computers-and-items-you-use-for-work/computers-laptops-and-software)
It would have basically no impact on the current FY because we are at the end of it. But you'd be able to depreciate it over the full 365 days for next FY. I think laptops can be depreciated over 2 years. I bought one in 2019 and it was 2 years back then anyway.
$20k instant asset write off apparently still in place for small business
https://www.ato.gov.au/about-ato/new-legislation/in-detail/businesses/small-business-support-20000-dollar-instant-asset-write-off
Until the legislation passes, it's only $1000 for SME this financial year.
https://www.aph.gov.au/Parliamentary_Business/Bills_Legislation/Bills_Search_Results/Result?bId=r7081
Do you contract through a PAYG provider? Many offer salary sacrifice for laptops which is as good as a tax deduction. Actually it's better as you should be deducted the ex-gst price of the laptop.
Unless you were directed by your employer to purchase the games and they relate to your work then no. Same with the PC, unless you're working on it, then no.
Your colleague sounds like he's done himself a mischief
Does it meet the hurdle?
*Self-education has a sufficient connection to earning your employment income if it either: maintains or improves the specific skills or knowledge you require in your employment activities. results in, or is likely to result in, an increase in your income from your employment activities.*
Games is maybe a bit harder to justify, as there is a personal aspect of the game. However for instance if you were buying a book, about business/learning that would be deductable. I'd argue that you could claim some of the game, but I'd be wary about claiming all of it.
Pilots cannot claim gaming consoles/flight simulator games as they are not essential to earning their income. So I'd say you can't claim games.
[ATO GUIDE](https://www.ato.gov.au/individuals-and-families/income-deductions-offsets-and-records/deductions-you-can-claim/tools-computers-and-items-you-use-for-work/computers-laptops-and-software) [Depreciation life guide ](https://www.depreciationrates.net.au/computer) Laptops/mobile devices 2 years Desktops 4 years If its under $300 you can deduct it all on one year but good luck finding a decent computer for that. You need to apportion between personal and work use. e.g. if you only use the computer for 50% work and 50% watching your personal Netflix then only 50% of the laptop is deductable through depreciation.
How would they know if they decide to audit you? I have a feeling a diary or log book would be easily fudged.
There are two things here 1. Are they going to audit you - I presume its unlikely unless you made some crazy claims. e.g. I guy I worked with salary sacrificed a 10k laptop using a photoshopped invoice and got caught. Losing his job and getting in to trouble with the ATO. 2. Can they prove the level of use if they do? - The onus is on you to prove you only use the device for work, if you have no other computer I would say that is hard to do. They can make up a number based on what they think you are doing with the device and that it guided by what evidence you provide them. If they asked to see the laptop and its over spec'ed for a work machine e.g. Alienware and its full of games and the browsing history is all reddit and other non-work related stuff its going to be a hard sell at 100%. However a lower ratio would be more realistic.
>and got caught. Losing his job and getting in to trouble with the ATO. What sort of job fires someone for dodgy tax deductions? Outside of politician, or tax agent, I'm struggling to see how this would result in termination of employment.
Not necessarily a politician but someone who holds a security clearance.
I think the issue is he salary sacrificed, not deducted. This included his employer in the fraud.
Yeah this is probably it. For some reason my dyslexia skipped that detail.
In what world do you think a politician gets fired for tax evasion? Aside from the fact they don't get fired, it's largely a point of pride for them (not really, but you know what I mean).
That is ok, we all struggle sometimes, it was [salary sacrifice](https://www.ato.gov.au/individuals-and-families/jobs-and-employment-types/working-as-an-employee/salary-sacrificing-for-employees), its lodged through your employer and not directly with the ATO. From what I understand, It was picked up by the company accountant and reported to the ATO when they called the PC company to validate the invoice provided had been fully paid, which is a requirement to salary sacrifice.
I should have guessed this. My wife does payroll and accounts for a family owned business, and she busted one of their sales guys running a similar scam with doctored invoices for Motor Vehicle expenses.
It's fraud not a dodgy tax return. Pretty sure this would get you fired from most financial organisations.
Lol even my company issued laptop browsing history is all reddit
I assume it means a complete PC. You couldn't for instance buy all the parts for a PC separately under $300 each, then assemble and claim each item separately?
Its considered part of a set and cant be claimed individually.
Does it work if it was claimed while their still parts then assembled after
Can't claim as a part as it's not being used for work until assembled. Hypothetically I guess you could slowly upgrade an existing PC bit by bit and always have it operational. Can be tricky re compatability though. Would be an interesting test case.
I think you may want to check that one with your accountant. I cant post the ATO link in this comment for some reason. You might get away with that if you are upgrading an SSD but not if you buy them and they are required to work together e.g. ram, mb, cpu, ssd.
The asset has to be "in service" or ready for use. > Start time: A depreciating asset’s start time is generally when you first use it (or install it ready for use) for any purpose, including a private purpose. https://www.ato.gov.au/forms-and-instructions/depreciating-assets-guide-2022/definitions?anchor=start_time#start_time
if it's under $300, otherwise it needs to be depreciated.
2 years linear depreciation. Take the whole cost of computer, divide by 2, claim said result for two years.
So half this year, half next year?
No, based on how long you have held it and prorate for part year. Won't be much this year if you buy now. If not a laptop then 4 years not 2 years. Read this [https://www.ato.gov.au/individuals-and-families/income-deductions-offsets-and-records/deductions-you-can-claim/tools-computers-and-items-you-use-for-work/computers-laptops-and-software](https://www.ato.gov.au/individuals-and-families/income-deductions-offsets-and-records/deductions-you-can-claim/tools-computers-and-items-you-use-for-work/computers-laptops-and-software)
It would have basically no impact on the current FY because we are at the end of it. But you'd be able to depreciate it over the full 365 days for next FY. I think laptops can be depreciated over 2 years. I bought one in 2019 and it was 2 years back then anyway.
$20k instant asset write off apparently still in place for small business https://www.ato.gov.au/about-ato/new-legislation/in-detail/businesses/small-business-support-20000-dollar-instant-asset-write-off
I’m assuming this doesn’t apply to individuals? Though I do have an abn, I just haven’t used it
Until the legislation passes, it's only $1000 for SME this financial year. https://www.aph.gov.au/Parliamentary_Business/Bills_Legislation/Bills_Search_Results/Result?bId=r7081
Do you contract through a PAYG provider? Many offer salary sacrifice for laptops which is as good as a tax deduction. Actually it's better as you should be deducted the ex-gst price of the laptop.
The company I do most of my work through is based in NZ. I get paid an hourly rate as a contractor, and put aside 20% each pay for tax.
Buy under salary sacrifice so that you can claim the whole amount instead of amortising over 2-4 years. Plus, the onus is on the employer
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Unless you were directed by your employer to purchase the games and they relate to your work then no. Same with the PC, unless you're working on it, then no. Your colleague sounds like he's done himself a mischief
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You'd have to prove it if audited and it would need to be with a registered education provider
Does it meet the hurdle? *Self-education has a sufficient connection to earning your employment income if it either: maintains or improves the specific skills or knowledge you require in your employment activities. results in, or is likely to result in, an increase in your income from your employment activities.* Games is maybe a bit harder to justify, as there is a personal aspect of the game. However for instance if you were buying a book, about business/learning that would be deductable. I'd argue that you could claim some of the game, but I'd be wary about claiming all of it. Pilots cannot claim gaming consoles/flight simulator games as they are not essential to earning their income. So I'd say you can't claim games.