It’s common for hairdressers to pay for items like hair clippers, travel between clients and uniforms out of their own pocket without claiming them back on tax. Expenses like these are usually considered tax deductions, which means you can claim them on your tax return. But for hairdressers, there are strict rules on what is considered an allowable deduction, and a fine line between a work-related and a ‘private’ expense.
Hairdresser tax deductions:
There are many types of travel expenses, making it a common deduction for a hairdresser to claim on tax. From accommodation, to parking, or even catching a train or cab between clients. We’ll break it down, so you know what travel expenses you can (and can’t) claim on your next tax return.
If you pay for parking each day for work, you can’t claim the expense since it is considered a private cost to park at your usual workplace. But if you travel, for example to help at another salon owned by the same employer and need to pay for parking, that’s an allowable deduction.
Public transport, tax, car hire
Travel to other salons, directly to your clients, and to seminars or conferences can incur out of pocket expenses that you wouldn’t usually have to pay on a normal workday. If you are required to catch public transport, a taxi, or hire a car, for the above reasons, you can claim these expenses on your tax return.
For more, read our article on work-related travel expenses.
From attending conferences, to hairstyling for weddings and other events on site, travelling for work is a standard part of the job for many hairdressers. If you are required to stay away from home, your accommodation costs could be considered an allowable tax deduction. However, if you decide to stay an extra night or two for pleasure, this is where the ATO draws the line. Only claim the portion of travel expenses directly necessary for work.
Generally, you can’t claim travel between your home and work, unless you are required to transport large or heavy equipment that cannot be stored at your place of work (normally tradies). Car expenses can be claimed as a tax deduction if you are required to provide your services in a client’s home or another venue. Also, if you drive your car between salons, you can claim the travel between your usual place of work and the secondary location.
There are two ways to claim your car expenses, and a different requirement on record keeping for both. Either way, the rules surrounding when you can claim are the same. Read more about claiming car expenses here.
Clothing & Laundry
It’s very common for hairdressers to wear a uniform or be given instructions on what clothes to wear but following these policies don’t always guarantee you can claim an expense.
So, what can you claim? For a work uniform expense to be claimable, it must identify you with your place of work, via a logo. General work attire, for example plain black clothing, cannot be claimed without a logo, even if it’s required by your employer.
Each time you wash your ‘eligible’ uniform, you can also claim the laundering of that item as a tax deduction. And, for a hairdresser, that’s going to be often! Just make sure you keep a record of how many loads you do, and whether those items are washed separately, or if they were mixed with your personal laundry.
As a hairdresser, it’s essential to keep up with the latest trends and techniques. One of the best and most affordable ways to do this is to subscribe to relevant magazines and other publications. But did you know you can claim these magazines and publications if they directly relate to your occupation, and you pay for them yourself?
For example, if you subscribe to hairdressing magazines to keep up to date with the latest hair trends and styles, you can claim these on your tax return. Unfortunately, anything more generic like a fashion magazine your clients might like to read, is not an allowable expense.
If you’ve wondered whether as a hairdresser you can claim your phone expenses as a tax deduction, the answer is simple: if you use your phone for work, you can claim that portion on your tax return.
Whether you take bookings on your mobile, contact clients each day or even manage a team and roster, claiming your phone on your tax return could boost your tax refund!
Don’t assume this means you can claim 100% of your phone bill! You’ll need to calculate the work-related portion of your phone usage. Read more about how to claim your work-related phone expenses here.
Self-education is a great way to get ahead in your career as a hairdresser. Did you know that you can claim self-education expenses on your tax return as a deduction? You can’t claim just any course though. It must be relevant to your current job (so you can’t claim a hairdressing traineeship if you’re working at the front desk).
Here are some rules for claiming self-education as a hairdresser:
- Is the course relevant to your current job?
- Did you pay for it yourself, without receiving a reimbursement from your employer?
- Did you pay upfront? (You cannot claim if you paid for your course with a student loan, such as HELP/HECS, TSL, etc.)
The same goes for hairdressers that attend seminars, conferences and courses. However as mentioned earlier, you can only claim the work-related portion of these expenses. For example, if you attend a two-day conference in another state and decide to make a long weekend out of it and stay an additional two days, you can only claim the costs directly involved with the event, not the extra days you extended for.
Claiming self-education on your tax return can be tricky. If you’re not sure whether you can claim, or how, contact our accountants by logging into your Etax account and send them a message. Also, you can read about the ins and outs of claiming self-education expenses here.
Tools and Equipment
Every hairdresser requires a variety of tools and equipment to do their job. Even the simplest haircut involves a brush, comb, scissors, apron, spray bottle and more! And these items are not always supplied by your employer. You can claim the whole cost of an item under $300, but only the depreciation on items that cost over $300.
There are also some rules you need to follow to be able to claim your tools and equipment on your tax return. Firstly, you must have paid for them yourself and can’t have been reimbursed by your employer. You must use these items mainly for work purposes. So, you can’t claim something as a tax deduction that you purchased for home.
Tax Agent Fees
And lastly, as always, make sure you claim your tax agent fees for lodging your tax return last financial year. This is by far the easiest deduction for anyone to claim, especially with Etax! If you’re not sure what to do, just leave us a message in your tax return and we can fill it in for you.
What records do you need to keep for hairdresser tax deductions?
Like any deduction, record keeping is essential because the ATO can request a record of each expense you claim on your tax return. Therefore, it’s important to keep a receipt for each expense. Take a photo and save them in a special folder or email them to yourself. This will keep them safe from being lost or fading over time.
How do you lodge a hairdresser tax return?
With Etax, it’s easy! Just login to your Etax account, open the year you want to complete and enter your occupation. This will automatically show you the deductions you could be entitled to claim as a hairdresser! It will also let our accountants know how to help you best. And the best part? It only takes you minutes – then we’ll do the rest!
Are you working as a sole trader?
You must enter any income earned as a sole trader into the business section of our Etax tax return. Here’s how to do it:
- Login to your Etax account.
- Open the year you want to complete.
- Go to the “Income” section and under “Business Income Sources”, select “Business Details P1-P8”.
- Enter your income for the financial year.
It’s important to remember to only include income earned as a sole trader in this section. If you were an employee for another business, you must enter that income under the “Salary/Wages” section. If you’re not sure where to put your income on your Etax return, contact our accountants by logging into your Etax account and Live Chat or send them a message.