Australian Tax Substantiation Guide 2025–26: Records & Receipts

Australian Tax · Records & Substantiation · 2025–26

What Tax Records Do You Need? Substantiation Thresholds for Every Claim

A complete reference for the records you must keep to claim a deduction. Each expense type has its own threshold and rules — knowing them stops claims being disallowed at audit.

FY 2025–26 · Last reviewed June 2026 · Source: ITAA 1997 Division 900

FY 2025–26 $300 substantiation rule 5-year retention Special-rule expenses

Quick answer

If your total work-related expenses are $300 or less, no receipts are required — but the expense must actually have been incurred. Once they exceed $300, written evidence is required for the entire claim, not just the amount over $300. Several expenses sit outside this total and have their own rules — car (cents per km needs no logbook), laundry under $150 (no receipts), travel diaries (6+ consecutive nights away), and working from home (a contemporaneous timesheet of actual hours). Keep records for 5 years from the date the return was lodged.

Key takeaways

$300 is all-or-nothing. Claim $310 and you need evidence for the full $310, not just the $10 over.
Five expense types sit outside the $300 total — car, travel allowance, overtime meals, award transport, laundry, and WFH — each with its own rule.
The WFH timesheet must be contemporaneous. Reconstructed-at-year-end hours aren't accepted under the fixed-rate method.
Bank statements alone usually fail — they don't show the nature of the goods or services. Keep the receipt.
Retention is 5 years generally — but CGT and depreciation records run far longer, and fraud/evasion has no limit.

What triggers whatThe core substantiation thresholds

Total work-related expenses

$300

Under $300: no written evidence required, but the expense must have been incurred — the ATO can ask how it was calculated.

Over $300: written evidence required for the entire claim, not just the amount over $300. Excludes car, laundry, overtime meals and travel allowance — these have separate rules.

Laundry expenses

$150

Up to $150: no receipts. Reasonable basis: $1 per load of work clothing washed at home (own clothes), $0.50 per load (mixed with private). Diary encouraged.

Over $150: written evidence required. Applies only to clothing eligible for a deduction (uniforms, protective, occupation-specific).

Small expenses (single)

$10

Individual expenses $10 or less: a diary record is acceptable instead of receipts — provided the total of such expenses is $200 or less for the year.

Diary must include date, supplier, amount and nature, recorded as soon as possible after the expense.

Small expenses (annual total)

$200

Total of all small expenses (each ≤$10): if the annual total stays at or under $200, a diary is sufficient.

Once the total exceeds $200, all of these expenses then require proper written evidence — the diary alone is no longer adequate.

Asset cost — immediate deduction

$300

Asset cost $300 or less: immediate deduction available where used more than 50% for producing non-business assessable income.

Over $300: depreciate under Div 40 or pool in the low-value pool. The "set rule" and "multiples rule" prevent splitting a larger purchase into items under $300.

Travel diary trigger

6 nights

Domestic travel 6+ consecutive nights: a travel diary is mandatory in addition to receipts — each activity recorded with date, place, time, duration.

Overseas travel 6+ consecutive nights: diary always required, even when receiving a travel allowance equal to the reasonable amount.

Over the thresholdWhat counts as written evidence

The five required details

Acceptable forms of written evidence

For deductions over the substantiation threshold, written evidence must contain specific details. Missing any one means the document may not be accepted.

Required detail	What it means
Name of supplier	The business or person you paid
Amount of expense	In Australian dollars (or with conversion if foreign)
Nature of the goods or services	What was purchased — not just "groceries" or "miscellaneous"
Date the expense was incurred	The transaction date, not the receipt print date
Date of the document	When the document was created

✓ Acceptable forms

Tax invoices, receipts, bank or credit card statements (if they show all required details), supplier invoices, electronic receipts, photos of receipts, screenshots of online purchases. Bank statements alone are usually insufficient — they don't show the "nature of goods or services", so keep the original receipt.

Every common expenseSubstantiation by claim type

← Swipe the table sideways to see all columns →

Expense type	Threshold rule	Records required	In $300 total?
General work expenses	$300 substantiation rule	Receipts/invoices for all if total >$300; nothing if ≤$300 (but must have incurred)	Yes
Car — cents per km	Up to 5,000 work km per car	Reasonable estimate of work km (calendar, diary, examples) — no logbook needed	No — separate
Car — logbook method	No km limit; full method	12-week logbook (valid 5 years), odometer readings, receipts for fuel, registration, insurance, repairs, services	No — separate
Laundry of eligible clothing	$150 threshold	Up to $150: diary or reasonable basis ($1/load, $0.50 mixed). Over $150: receipts, written records	No — separate
Overtime meals	Award allowance required	Allowance must be paid under industrial award. Reasonable amount per ATO determination — receipts only if exceeding it	No — separate
Travel — domestic, <6 nights	Travel allowance + reasonable amount	Receipts if exceeding the reasonable amount; no diary required under 6 consecutive nights	No — separate
Travel — domestic, 6+ nights	Diary required	Travel diary recording activities (date, place, time, duration) plus receipts	No — separate
Travel — overseas (any length)	Diary required for 6+ nights	Diary, receipts, apportionment of work vs private days	No — separate
WFH — fixed rate (70c/hr)	Contemporaneous timesheet required	Timesheet of actual hours worked from home (start date critical), one bill for each running cost claimed	Combined
WFH — actual cost	Receipts and diary	4-week diary of work use, receipts for all costs claimed, calculations showing work percentage	Combined
Phone & internet	Diary if work %	4-week representative diary, monthly bills. If the claim is under $50 total, no records required	Yes
Tools & equipment ≤$300	Immediate deduction	Receipt showing item, cost, date — used >50% for income production	Yes
Tools & equipment >$300	Depreciation under Div 40	Receipt, effective-life calculation, depreciation schedule, opening balance each year of pool	Yes (the depreciation)
Self-education	$300 rule + nexus test	Course receipts, textbooks, stationery, evidence of relationship to current job	Yes
Donations to DGRs	$2 minimum per donation	Receipt from the deductible gift recipient showing date, amount, ABN, DGR status	No — separate
Union fees, memberships	Standard $300 rule	Income statement entry, payment receipts, or annual membership invoice	Yes
Tax agent fees (D10)	Standard $300 rule	Invoice from a registered tax agent or BAS agent showing fee, services, year	Yes
Personal super contributions (D12)	Special rules	Notice of intent lodged with fund, fund acknowledgement, receipt of contribution	No — separate
Income protection insurance	Standard $300 rule	Insurance policy schedule, premium receipt or statement	Yes

Retention periodsHow long to keep records

The 5-year rule and its exceptions

Most records: 5 years — but some run much longer

Records generally must be kept for 5 years from the date the return is lodged. But CGT and depreciation records have much longer requirements.

Record type	Minimum retention	Why
General work-related expenses	5 years from lodgement	Standard amendment period for individuals
Records for CGT assets	Until 5 years after disposal	Cost base must be proven on sale — possibly decades after acquisition
Depreciation schedules	Until 5 years after the asset is fully written down or disposed	Effective life, decline in value and balancing adjustments relate back to original cost
Trust & partnership returns	5 years from later of lodgement or last action affecting them	Beneficiary entitlements span multiple years
Records involving fraud or evasion claims	No limit	The ATO can amend assessments indefinitely where fraud or evasion is alleged
Self-managed super fund records	10 years for trustee minutes and member records	SIS Act requirements

Limited exceptionsWhen records are lost or destroyed

Narrow concessions — evidence required

What the ATO will and won't accept

Generally, if records are lost or destroyed the ATO will disallow the claim. The exceptions are narrow and require proof.

✓ ATO may accept

Records lost in circumstances beyond your control:
• Fire (police or fire report)
• Flood or natural disaster
• Theft (police report)
• Computer failure with no backup (only if reasonable precautions were taken)

You must show you took reasonable precautions to protect the records.

✗ ATO will likely disallow

Records lost through carelessness:
• Receipts thrown out at year end
• Files lost when changing computers
• Records misplaced over time
• Records "left at home" during travel
• No backup of digital records

The onus is on the taxpayer — there's no defence in saying "I had them."

When standard rules don't applyExpenses with their own rules

The exceptions

Six categories sit outside the $300 total

These categories have their own substantiation rules and their own thresholds — they aren't added to (or subtracted from) the general work-expenses total.

Expense category	Its own rule	Notes
1. Car expenses	Cents per km (up to 5,000 km, no actual-cost records) OR logbook (12-week, every 5 years)	Choose method per car. Switching to logbook requires recording all costs.
2. Travel allowance expenses	Receipts only if the claim exceeds the ATO reasonable amount	Reasonable amount varies by destination tier and salary band
3. Overtime meal expenses	Allowance must be paid under industrial award. No receipts if within the reasonable amount	Both conditions required — no overtime allowance = no concessional substantiation
4. Award transport payments	Special substantiation rules apply	The industry award sets specific transport allowance terms
5. Laundry of eligible clothing	Up to $150 — no receipts	Reasonable basis ($1/load, $0.50 mixed) acceptable
6. WFH — fixed rate	Timesheet of hours from start of year + one bill per running cost	Can't retroactively reconstruct hours — start date critical

⚠️ Critical — these are NOT in the $300 total

When working out whether work expenses exceed $300, do not include car expenses, laundry, overtime meals, travel allowance or working-from-home costs. A taxpayer with $250 of general expenses plus $1,000 of car expenses does not need receipts for the $250 — even though the combined total is $1,250.

A permitted substituteWhen a diary alone is enough

Contemporaneous records

When a diary replaces receipts

In several specific scenarios a diary entry is an acceptable substitute for written evidence — but it must be contemporaneous (made at the time, or as soon as possible after).

Diary use case	What the diary must show	Limits
Small expenses (each ≤$10)	Date, supplier, amount, nature of expense	Annual total of all such expenses must be ≤$200
Travel — 6+ nights (domestic) or overseas	Date, place, time and duration of each work activity	In addition to receipts, not a substitute
Mobile phone / internet usage	4-week representative period showing work vs private use, with a calculated %	Applies the % to actual bills — doesn't replace the bills
Laundry under $150	Date, number of loads, eligible clothing washed	Reasonable basis: $1/load own clothes, $0.50/load mixed
WFH — fixed rate method	Timesheet recording every hour worked from home through the year	Must be kept from the start of the year — retrospective estimates not accepted
Car — work km estimate (cents per km)	Reasonable basis showing how the km figure was estimated	Diary of trips, calendar entries, examples of typical work trips

Adviser playbookPractical tips for better substantiation

🎯 Tip 1 — Digital is fine, but capture immediately

The ATO accepts electronic copies — photos, scans, PDFs, screenshots. Use a receipt-tracking app (or your phone's camera) to capture receipts the moment you get them. Paper fades and gets lost; digital captures preserve every required detail, and timestamps confirm they're contemporaneous.

🎯 Tip 2 — Start the WFH timesheet on 1 July

Under the fixed-rate method, working-from-home hours must be recorded as they happen. The ATO will not accept a timesheet reconstructed at year end. A client who started keeping a timesheet partway through the year can only claim from the date it began. Set up the diary on 1 July — every year.

🎯 Tip 3 — Bank statements alone are not enough

A bank statement shows you paid a supplier, but not the nature of the goods or services. For deductions over the threshold, the original receipt or invoice is still required. The exception is utilities, rates and similar suppliers where the statement clearly identifies the supplier and the nature of the transaction.

🎯 Tip 4 — Document the apportionment, not just the receipts

For mixed-use expenses (phone, internet, computer, car), keep the calculation showing how the work percentage was derived — not just the receipts. The ATO will ask "how did you arrive at 60% work use?" Without a diary, calculation or supporting record, the claim is likely to be reduced.

🎯 Tip 5 — Don't fall for the $300 threshold trap

A claim of $310 in work-related expenses (excluding car, laundry, meals, travel) requires written evidence for the full $310 — not just the $10 above the threshold. Many people think it means "no receipts up to $300"; it actually means all-or-nothing. This is one of the most common audit failure points.

FAQFrequently asked questions

Do I really need receipts if my total work expenses are under $300?

No — you don't need written evidence (receipts, invoices) if your total work-related expenses are $300 or less. However, you must have actually incurred the expense and be able to explain how you calculated the claim. The ATO can still ask questions and disallow claims with no reasonable basis. Car expenses, laundry, overtime meals and travel allowance are excluded from this $300 calculation — they have their own rules.

How long do I need to keep tax records?

Generally five years from the date the return was lodged. For CGT assets, keep records for at least five years after the asset is disposed of — so records for a property bought in 2010 and sold in 2030 must be kept until 2035. Depreciation records similarly span the entire effective life of the asset plus five years. Records relating to fraud or evasion can be requested indefinitely.

Can I claim deductions if I lost my receipts in a flood or fire?

Yes, in limited circumstances. The ATO will generally accept claims where records were lost or destroyed in circumstances beyond your control — fires, floods, theft — provided you have evidence of the incident (police report, insurance claim, fire report) and can show you took reasonable precautions to protect the records. Records lost through carelessness, system failures without backup, or simply being misplaced are not covered.

What's the difference between the $300 substantiation threshold and the $300 immediate deduction threshold?

They are completely different rules that happen to share the same dollar amount. The $300 substantiation rule says you don't need written evidence if your total work-related expenses are under $300. The $300 immediate deduction rule (Section 40-80) says you can deduct the full cost of a depreciating asset immediately if it cost $300 or less and is used more than 50% for non-business income. One is about records; the other is about depreciation.

Do I need a logbook to claim car expenses?

Only if you use the logbook method or claim more than 5,000 work km. Under the cents per km method you can claim up to 5,000 work km per car without a logbook — but you must show a reasonable basis for the figure (diary, calendar entries, examples of typical work trips). Above 5,000 km, or to claim actual costs, a 12-week logbook is required, and it remains valid for five years.

Do I need receipts for laundry of my work uniform?

Only if your total laundry claim exceeds $150. Up to $150, the ATO accepts a reasonable basis: $1 per load when washing only eligible work clothing, or $0.50 per load when washing eligible items mixed with private clothes. A diary record is encouraged. Above $150 you need receipts for dry cleaning and a written record of home laundry. This only applies to clothing that qualifies for a deduction — uniforms, occupation-specific or protective clothing.

Disclaimer

General information only — not financial, tax or legal advice. Verify all rules at ato.gov.au or consult a registered tax agent for advice specific to your circumstances.

Australian Tax Substantiation Guide 2025–26: Records & Receipts

What Tax Records Do You Need? Substantiation Thresholds for Every Claim

Key takeaways

What triggers whatThe core substantiation thresholds