Many Australians expect a tax refund. What surprises them is how much they leave behind. At Tax NextGen, we regularly see the same pattern across individual returns: people are owed more than they realise, but they lodged without checking, guessed at a couple of deductions, and accepted whatever number appeared on screen. Getting a bigger tax refund is not about bending rules; it is about knowing every deduction you are legally entitled to claim and making sure someone who knows the system is looking at your return.

By the end of this article, you will know which deductions Australian employees most commonly miss, how work-from-home claims actually work in 2025, 26, what records the ATO expects you to keep, which timing strategies can shift more refund dollars your way, and when a professional review will pay for itself several times over.

How to Get a Bigger Tax Refund: Deductions Australians Overlook Every Year

The ATO publishes occupation-specific guidance on claimable deductions, yet self-lodged returns consistently show the same categories going unclaimed. The pattern is not laziness, it is a lack of awareness. Most employees simply do not know these costs qualify. Knowing where to look is the first step to maximising your tax refund.

Self-education, memberships, and professional subscriptions

Self-education expenses are deductible when the study directly maintains or improves skills you use in your current job, or is likely to increase your income from that role. A nurse completing a CPD course qualifies; the same nurse studying a new field to change careers does not. Course fees, textbooks, and related travel can all be claimed when the connection to your current employment is genuine.

Union fees, professional association memberships, and industry subscriptions are among the most consistently overlooked deductions on individual returns. If you pay annual dues to a professional body or receive a trade journal relevant to your work, those costs are deductible. Digital subscriptions also count, provided you can show a clear link to your employment duties. A recruitment consultant paying for a LinkedIn Premium subscription used for work is a straightforward example.

Income protection insurance, tools, and small equipment

Income protection insurance premiums are deductible when the policy is held outside of superannuation. Many employees pay these premiums directly and never claim them. If you hold a policy this way, the annual premium belongs in your tax return every year.

Work-related tools and equipment costing $300 or less can be claimed as an immediate deduction. Laptops, tablets, headsets, and other peripherals used for work all qualify, but you must apportion the claim to exclude private use. Buying a $280 keyboard entirely for work? That is a full, immediate deduction. Buying a $1,500 laptop split 60% work and 40% personal? The deduction is $900, claimed through depreciation over the asset’s effective life.

Occupation-specific clothing and laundry

Hi-vis gear, steel-capped boots, compulsory branded uniforms, and safety equipment are all claimable. Laundry costs for eligible work clothing are also deductible, within ATO limits. What catches people out is the boundary: a generic suit worn only to the office does not qualify, nor does conventional business attire even if your employer expects you to dress professionally. The clothing must be distinctly work-related, either for safety or because it is a registered, compulsory uniform. If you are unsure, the ATO’s occupation-specific guides are a useful starting point.

How to Get a Bigger Tax Refund with Work-from-Home Claims

Working from home has become a permanent feature of Australian employment, and the ATO has updated its rules accordingly. The method you choose to claim these costs has a meaningful impact on your refund, getting this right is one of the most effective ways to increase your tax refund in 2025, 26.

What the 70 cents per hour fixed rate actually covers

For 2025, 26, the ATO’s fixed-rate method allows a deduction of 70 cents for every hour worked from home. That rate bundles together energy costs for heating, cooling and lighting, internet, phone, stationery, and computer consumables. You cannot separately claim those same items on top of the fixed-rate deduction: it is one or the other, not both.

The critical record-keeping requirement is a log of every hour worked from home across the full income year. The ATO is explicit that an estimate is not acceptable. A timesheet, roster, or daily diary entry is the safest approach. You will also need at least one bill for each expense type covered by the rate, for example, an electricity bill and an internet bill, to demonstrate those costs were genuinely incurred.

Claiming separately under the actual cost method

The actual cost method lets you claim the work-related proportion of each running expense individually. If your home office costs are high, this method can produce a larger deduction than the fixed rate. Calculating the work-related proportion requires a reasonable basis, floor area or hours of use are common approaches, along with records of the actual expenses incurred.

Regardless of which method you use, the decline in value of depreciating assets used for work, such as a desk, ergonomic chair, or monitor, can still be claimed separately. In limited circumstances, where you have a dedicated home office, a proportion of occupancy costs like rent or mortgage interest may also be claimable. Both methods have their place; the right one depends on your actual costs.

ATO Substantiation Rules Made Simple

Understanding what records you need, and when, prevents two common problems: over-claiming without evidence, and under-claiming because you discarded receipts thinking they would not matter.

The $300 rule and what it means in practice

If your total work-related deductions are $300 or less, the ATO allows you to claim without written evidence such as receipts or invoices. You still need to show how you calculated the amount, but a brief note explaining the calculation is sufficient. Once your claims exceed $300, written evidence is required for most expense types, including bank statements, invoices, and receipts.

One important boundary: car expenses and travel allowance expenses sit outside the general $300 threshold. They carry their own separate substantiation requirements, so do not assume the $300 rule gives you a free pass on vehicle claims. The ATO provides specific guidance on these exceptions, and it is worth reviewing before you lodge.

Keeping a kilometres diary and work-from-home hours log

For car claims using the cents per kilometre method, the 2025, 26 rate is 88 cents per kilometre, up to a maximum of 5,000 work-related kilometres, giving a maximum claim of $4,400 under this method. You do not need petrol receipts, as the rate covers all running costs, but you do need a record showing how you calculated the kilometres. A diary, spreadsheet, or the ATO’s myDeductions app all satisfy this requirement.

If your work-related driving exceeds 5,000 kilometres, the logbook method removes the cap. That requires a 12-week continuous logbook recording the date, start and end odometer readings, total kilometres, and purpose of each trip. Once completed, the logbook is valid for five years unless your usage pattern changes materially.

Timing Strategies That Shift More Refund Dollars Your Way

Refund size depends on what you claim and when you spend money on deductible items. A few deliberate timing decisions before 30 June can make a meaningful difference to getting a bigger tax refund this year.

Prepaying deductible expenses before 30 June

Any deductible expense paid on or before 30 June counts in the current income year. Renewing a professional membership in late June rather than waiting until July, buying work equipment before year-end, or paying an income protection insurance premium before the cut-off all bring the deduction forward into the current return. The ATO permits individuals to prepay up to 12 months of eligible expenses, making this a straightforward and widely used strategy for employees with predictable annual costs.

Timing your charitable donations correctly

Donations to organisations with Deductible Gift Recipient (DGR) status are deductible in the year the payment is made. A donation processed on 30 June falls in this year’s return; the same donation made on 1 July falls in next year’s. That timing difference is easy to manage once you are aware of it. Before claiming, verify DGR status through ABN Lookup on the Australian Business Register, not all registered charities hold DGR status, and the ATO disallows deductions for donations to organisations that do not.

Requesting a PAYG withholding variation

If your deductions are consistently high year after year, you do not have to wait until you lodge to access the tax benefit. You can apply to vary your PAYG withholding so less tax is withheld from each pay cycle throughout the year. The refund at lodgement will be smaller, but the same dollars arrive in your pay packet rather than sitting with the ATO until July or August.

Tax Offsets Worth Knowing About in 2025, 26

Deductions reduce your taxable income; offsets reduce the tax you owe directly. The distinction matters, because offsets often deliver dollar-for-dollar savings rather than the fractional benefit of a deduction.

Low Income Tax Offset: who it applies to and how much it is worth

The Low Income Tax Offset (LITO) is worth up to $700 in 2025, 26 for taxpayers with taxable income up to $37,500. It phases out at five cents per dollar of income between $37,501 and $45,000, then at 1.5 cents per dollar between $45,001 and $66,667, reducing to nil above that. The offset is applied automatically when you lodge, so there is no separate form to complete.

One thing to understand clearly: LITO is a non-refundable offset. It reduces tax payable, so it will only generate or increase a refund if tax was withheld during the year. It cannot create a refund on its own for someone who had no withholding. Also worth noting: the Low and Middle Income Tax Offset (LMITO) ended after the 2021, 22 income year and is no longer available.

The private health insurance offset: the refundable one

The private health insurance tax offset is one of the few refundable offsets available to Australian individuals, meaning it can contribute directly to a larger refund rather than simply reducing a tax bill. The amount depends on your income tier and age. If you hold private health insurance but have not been nominating the offset correctly through your insurer, you may have been missing money the ATO would otherwise return to you at lodgement time.

Why a Tax Agent Usually Finds More Than myTax Does

myTax is a functional self-lodgement tool, but it works only as well as the information you put into it. The system does not know what you do for work, how your home office is set up, or what expenses you paid during the year. It prompts you with general categories; it does not ask the right questions.

What gets missed in a DIY myTax lodgement

Common misses in self-lodged returns include occupation-specific deductions, income protection insurance premiums, the correct apportionment of home office assets, partial-year investment property claims, and the prior year’s tax agent fee, itself a deductible expense. A single overlooked deduction can mean hundreds of dollars in refund lost, and many people miss the same items year after year without realising the pattern.

In our experience at Tax NextGen, returns reviewed by a registered agent consistently produce larger refunds than self-lodged equivalents. The difference exists not because the agent inflates claims, but because a professional who works with individual returns every day knows where to look. An occupation-specific question from an experienced accountant often surfaces a deduction the client had not considered.

How a Chartered Accountant review adds up

Registered tax agents working on individual returns are trained to look for deductions specific to your occupation, income sources, and circumstances. At Tax NextGen, every individual return is handled by a Chartered Accountant or CPA who reviews your situation rather than just processing numbers. The fee for this service is itself tax deductible in the income year it is paid, partially offsetting the cost in your next return.

For most people who have only ever self-lodged, having a qualified accountant review their return reveals deductions they had not previously considered. If you have lodged through myTax in previous years and have never had a qualified accountant look at your return, there is a genuine chance you have been under-claiming consistently.

Tax Refund Tips for 2025, 26: Start Claiming What You Are Actually Owed

Getting a bigger tax refund in Australia is rarely about gaming the system; it is about knowing what you are legally entitled to claim and having the right person review your return. The deductions exist because Parliament legislated them, the only question is whether you are claiming all of them correctly.

The practical steps are clear: work through a deductions checklist for your occupation, keep proper records throughout the year rather than reconstructing them in July, time your prepayments and donations before 30 June, and understand which offsets apply to your income level. If any of those steps feel uncertain, that uncertainty is exactly where a registered tax agent earns their fee.

Tax NextGen offers a free initial phone consultation with no office visit required, from anywhere in Australia. If you would like a Chartered Accountant to review your return, identify what you may have been missing, and lodge on your behalf, booking a call is the lowest-risk starting point available. The consultation costs nothing; the deductions you discover could be worth considerably more.