A Tradie's Guide to Maximising Tax Deductions on Essential Gear

What counts as a tax-deductible trade expense?

To claim a tax deduction, the expense must be directly related to earning your income. For tradies, this usually covers tools of the trade, vehicle running costs, and work-related protective gear. If you use a tool or vehicle for both personal and business use, you can only claim the business portion.

1. Choose between the logbook method or the cents-per-kilometre method.
2. Keep a valid logbook for 12 consecutive weeks to establish your business usage percentage.
3. Maintain a folder of all receipts for fuel, insurance, and repairs.
4. Review your logbook every five years or if your driving habits change significantly.

Managing equipment depreciation

Small tools costing less than $300 can often be claimed as an immediate deduction. For more expensive equipment like excavators or laser levels, you must depreciate the cost over the item's effective life. This allows you to claim a portion of the value each year rather than the full cost at once.