In the Australian Taxation System, the tax deductions available for coffee expenses are quite specific.
Coffee Expenses at Work
Generally, the cost of buying coffee can’t be claimed as a deduction as the expense doesn’t directly relate to earning your income. However, there are exceptions. For instance, if you’re an employer and you provide tea, coffee, and cakes on business premises for employees and customers, you can claim a tax deduction for these expenses.
Coffee Expenses for Clients
If you’re self-employed and run training classes where you pay for coffee/drinks for students on the day, you may be able to deduct this. Similarly, if you purchase refreshments or coffee and bring it back to your client’s office, this could be a tax-deductible expense.
Record Keeping Tips
Keeping accurate records is crucial for claiming these deductions. You should have invoices, receipts, or some other type of written evidence of any expenses. Electronic records are also acceptable, such as credit card or bank statements you download or access from the lender’s or bank’s website. It’s recommended to maintain your records for at least three years from the date you file your return.
To make record keeping easier, consider using the Deduction Grabber App. This free app allows you to snap a photo of your tax receipts and record your tax expenses as soon as you make them. It also includes an ATO compliant tax Motor Vehicle Logbook.