Tax Tips for Fly-in Fly-out Employee
Employees who work away from home for a number of days on a regular and rotational basis—returning to their normal residence for a few days off that are not the same in consecutive weeks—are typically regarded as fly-in fly-out (FIFO) or drive-in drive-out employees. A common example includes mining professionals and workers. FIFO employees may be eligible for a broader range of tax deductions than regular taxpayers. Here are some essential tips to help you maximise your tax benefits when preparing your tax return.
1. Travel Expenses
It’s important to note that you cannot claim travel expenses incurred between your home and the departure point specified in your FIFO arrangements. Refer to the ATO guidelines on travel expenses for more information.
2. Working in a Remote Area
To claim the zone tax offset, your usual place of residence must meet specific criteria:
- It needs to be in a remote or isolated area (known as a zone).
- You must have resided there for 183 days or more during the income year.
If your residence in a zone was less than 183 days in the income year, you may still be able to claim the offset if:
- The total number of days you lived there in the first year and the current income year equals 183 days or more.
- The period you lived in the zone in the current income year includes the first day of that income year.
3. Working Overseas
If you work in a foreign country, your income remains subject to Australian tax law. Be sure to consider the local tax laws as well; seeking advice from a local tax agent is advisable.
4. Self-Education Expenses
You can claim self-education expenses for courses or university studies that improve your current skills, provided these expenses are not reimbursed by your employer. However, pre-vocational course expenses are not deductible. Additionally, if you attend seminars or workshops away from your workplace, travel, accommodation, and meal costs may be deductible.
5. Phone and Internet Costs
If you make work-related phone calls using your mobile, you can claim a portion of your phone bills based on your work-related usage. This also applies to line rental costs and internet fees if you work from home occasionally. Be sure to document how you split these costs between work and personal use.
6. Tools and Equipment
You can claim deductions for work-related tools, which include logbooks, laptops, GPS devices, and relevant books or journals. For items costing less than $300, you can claim an immediate deduction. For equipment over $300, you may claim depreciation in subsequent years.
7. Clothing Expenses
While normal clothing costs (like shirts and jeans) are not deductible, the costs of uniforms or protective clothing required for your job can be claimed. Additionally, you can claim dry cleaning and laundry expenses, as well as other items like sunscreen, sunglasses, and hats if you frequently work outdoors.
8. Licences and Tickets
You cannot claim deductions for your normal driver’s licence, but you can claim expenses for further training, tickets, and renewal fees necessary for your role.
These are specific deductible items that FIFO employees should pay close attention to when preparing their tax returns. Other general deductible items for all taxpayers include work-related car expenses, gifts and donations, income protection, medical expenses, and tax agent fees. Remember to keep as many records as possible, including invoices and receipts, to support your deductions. If you’re unsure about your income or eligible deductions, seek advice from registered tax agents.
For personalised assistance with your tax return, contact Tax Accounting Adelaide at 08 8337 4460. Our team is here to help you maximise your tax benefits while ensuring compliance with ATO regulations.
