Both major parties have promised tax deductions as part of their election platforms, which would each take effect from July 2026.
Labor said it would provide an automatic $1,000 deduction for “work-related expenses” without requiring any receipts.
Meanwhile, the Coalition has committed to a one-off $1,200 tax cut for nearly half of working Australians.
Here’s how your tax could look a bit different next year.
Tax deductions
Australia has a “progressive” tax system, which means the more you earn, the more tax you pay.
You don’t pay tax for the first $18,200 earned in a financial year (1 July to 30 June).
Deductions are expenses that can reduce your taxable income, requiring receipts as proof. This includes certain work-related costs and most charity donations.
Labor's plans
Your contribution ensures The Daily Aus can continue doing the work you love.
I want to give $10 monthly to help TDA keep doing the news.
Your account details:
Starting in the 2026/27 financial year, Labor said it would allow taxpayers to claim $1,000 in work-related expenses without providing proof.
Prime Minister Anthony Albanese said the deductions would require people to “tick a box” instead of handing in a “box of receipts” for their tax return.
Work-related expenses normally include office equipment and site-specific uniforms and safety gear.
Work-related deductions above $1,000 and other deductions, like donations, would still require receipts.
Coalition
Meanwhile, the Coalition has said it would offer a one-off tax cut in the 2025/26 tax return.
Under the Coalition’s plan, anyone earning up to $144,000 would be eligible for a tax cut.
Those earning between $48,000 and $104,000 would receive a $1,200 tax deduction. The party estimates this would apply to half of Australian workers.
Anyone earning less than $48,000, or between $104,000 and $144,000, will receive a smaller amount.
