10 ways to help you optimise your tax refund

• Learn legitimate ways to optimise your tax refund under ATO rules

• Understand deductions that apply to hybrid and remote work

• Know what records you need to support your claims.

• See how your tax refund could support longer-term financial goals.

When it comes time to lodge your tax return, many Australians want to make sure they’re claiming everything they’re entitled to.

Whether you’re an employee, freelancer, or someone who works from home, understanding the rules can help you lodge with confidence.

Tax rules change over time, and the Australian Taxation Office (ATO) now uses advanced data-matching technology to identify incorrect or inflated claims.

That’s why it’s important to understand what you can claim, keep accurate records, and lodge your return carefully.

This guide outlines ten practical, compliant ways to optimise your tax refund based on current ATO guidance and common deduction categories.

Important: Always make sure your claims are genuine, work-related, and supported by records. If you’re unsure, seek advice from a registered tax professional.

1. Get organised early

Preparing early can make tax time far less stressful. Gather:

• Digital copies of receipts

• Income statements (now pre-filled in myGov for most employees)

• Bank statements and donation records

Many Australians now use digital folders or the ATO’s myDeductions tool to track expenses throughout the year. Keeping records organised helps reduce errors and missed deductions.

Why it helps: Accurate records make it easier to claim correctly and respond to any ATO queries.

2. Understand what you can (and can’t) claim for work

You can generally claim work-related expenses that:

• are directly related to earning your income

• you paid for yourself

• weren’t reimbursed by your employer

Examples include:

• uniforms or protective clothing

• tools or equipment required for your job

• professional memberships or licences

You can’t claim:

• expenses your employer reimbursed

• private or personal costs

• everyday clothing (unless it’s a specific uniform)

Check the ATO’s occupation-specific guides to confirm what applies to your role.

3. Claim working-from-home expenses correctly

Hybrid and remote work are now common, and the ATO allows two main methods to claim home-office expenses:

Fixed-rate method

• A set cents-per-hour rate covering electricity, internet, and phone usage

• Requires a record of hours worked from home

Actual cost method

• Claim the work-related portion of expenses such as electricity, internet, and depreciation

• Requires detailed records and calculations

You must keep a log of work hours and retain receipts or bills to support your claim. It is also important to note that you can only use one method per financial year.

4. Deduct digital tools and tech equipment

If you use technology for work such as a laptop, phone, or tablet, you may be able to claim the work-related portion of those costs.

Key points:

• Claims must reflect work use only

• High-value items may need to be depreciated over time

• You can’t claim devices provided by your employer

Keeping usage records helps support percentage-based claims.

You might also be interested in: Understanding taxes when buying and selling home in Australia

5. Track business or client travel carefully

Travel deductions can apply when you travel:

• between worksites

• to client meetings

• for work-related purposes away from your usual workplace

Note: Claims must relate directly to earning your income.

You generally can’t claim:

• travel between home and your regular workplace

Use a logbook or digital tracking tool to record:

• dates

• purpose of travel

• distance travelled

Records must be kept for at least five years.

6. Don’t forget charitable donations

Donations of $2 or more to registered charities may be tax-deductible if:

• the organisation is a deductible gift recipient (DGR)

• you didn’t receive anything in return

You’ll need receipts or bank records showing:

• the charity name

• donation amount

• date

Donations linked to raffles, auctions, or merchandise aren’t deductible.

7. Claim education and training that supports your current role

You may be able to claim education expenses if the training:

• directly relates to your current job

• helps maintain or improve your skills

Examples:

• short courses

• seminars

• professional development programs

Training for a new career or different occupation isn’t deductible, even if it increases future earning potential.

8. Declare all your income

Most income is now pre-filled in myTax, including:

• salary and wages

• bank interest

• Dividends

Pre-filled information should always be reviewed for accuracy.

You’re also responsible for providing and declaring accurate:

• freelance or side-hustle income

• digital platform earnings (e.g. rideshare or online marketplaces)

• investment or capital gains

Failing to declare income can trigger ATO follow-ups.

You might also be interested in: How do taxes work on an investment property?

9. Lodge your return accurately and on time

Most individual returns lodged through myTax are processed quickly when information is complete and accurate.

Key deadlines:

• 31 October if lodging yourself

• Up to mid-May the following year if lodging through a registered tax agent (eligibility criteria apply)

Lodging on time helps avoid penalties and delays.

10. Consider professional tax help

A registered tax agent can help:

• identify deductions you may overlook

• ensure claims align with ATO rules

• manage complex income or investments

The cost of using a tax agent is usually tax-deductible in the following financial year.

Summary: Common deduction categories

The table below summarises common deduction categories and record requirements:

You might also be interested in: What tax deductions can property investors claim?

How to use your tax refund wisely

If you receive a tax refund, you may want to put it toward longer-term financial goals.

Some people choose to:

• make extra repayments on their home loan

• build savings for a deposit

• create a financial buffer

Even small additional repayments can reduce interest over time. It is important to remember the right option depends on your personal financial situation.

Use our Extra Repayments Calculator to see how putting a refund toward your home loan could make a difference. Preparing your tax return doesn’t have to be complicated.

With the right records and a clear understanding of the rules, you can lodge with confidence and put any refund to work for your goals.

Frequently asked questions