Monday, September 3, 2007

Q&A: Allowances and Deductions


Question: I received a laundry allowance from my employer. Does this mean I have been reimbursed and can't claim a tax deduction for laundry?


Answer: Receiving an allowance from your employer (as shown on your payment summary) is not the same as being reimbursed. The allowance is taxable income and included on your tax return along with your regular wages. You can and should still claim a tax deduction for your actual laundry expenses in order to reduce your income (which now includes the allowance you received).


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The comments provided in this blog are general in nature and not intended to be specific advice. Each situation is different. You should discuss your circumstances with Alan (or another tax agent) to obtain individual advice before acting on any information.