Millions of Australian workers are set to be able to claim an instant $1000 tax deduction without needing to keep receipts, after the federal government confirmed it will lock the long discussed change into law.
Treasurer Jim Chalmers said the tax break will be formally legislated and is expected to be in place in time for the 2027 tax season next year. Under the proposal, eligible workers will be able to claim up to $1000 in work related expenses without substantiating those costs with receipts.
Chalmers said the change is designed to make tax time simpler while providing some relief. “This will cut back on paperwork, it will save time and money and it will provide a bit of tax relief as well,” he said. He also confirmed the measure is expected to apply to a large group of taxpayers: “It will benefit 6.2 million workers when they lodge a tax return next year.”
The maximum tax saving from the deduction is expected to be $470, with the average saving estimated at $205, depending on an individual’s tax bracket and circumstances.
Chalmers said the $1000 write off is part of the government’s broader budget agenda aimed at reducing income tax, and follows a commitment Labor took to the 2025 federal election.
Prime Minister Anthony Albanese has previously framed the policy as a way for people to keep more of what they earn sooner and without the administrative hassle. He said it would give more Australians “your own money faster” and make it easier to claim without relying on an accountant or chasing receipts. “No paperwork, no box of receipts, no scrolling through your online banking – just tick the box and your return is ready,” he said.
If legislated as planned, the new standard deduction option will mean many workers can choose a streamlined claim for smaller work related expenses, reducing the need to store and track receipts for every purchase at tax time.
