Picture this: you’ve just wrapped a long day on site, tools down, ute back in the yard. You paid for that job out of your own pocket. Fuel, new drill bits, maybe a fresh set of steel-capped boots. You know you earned that money. So why shouldn’t some of it come back to you at tax time?
Quick Summary:
- 2025 tax guide for Aussie tradies
- Learn how to maximise deductions
- Claim tools, vehicles, and work expenses
- Get quick cash back this tax season
If you’re a tradie, whether you’re a sole trader, part of a partnership, a small company, or an employee working the tools, this is your annual chance to get your hard-earned cash back.
The tricky part? Knowing exactly what you’re allowed to claim and how to do it right so the Australian Taxation Office (ATO) doesn’t give you grief.
At ITP Accounting Professionals, we’ve worked with hundreds of tradies over 50 years. We know your gear, your vehicle, your safety boots matter just as much as the figures in your tax return. So let’s roll up our sleeves and get into what you can claim, how, and when, so you walk away with more cash, less stress.
Who Are You And Why Does It Matters?
First up: your business structure matters. Whether you’re:
- a sole trader (you and your ABN),
- in a partnership (you and someone else sharing a business),
- a company/trust, or
- simply an employee tradie (you punch a time sheet but pay for your own gear),
Each has slightly different rules. But the common theme is: you spent money to earn your income, and that means potential claims.
Pro Tax Tip: If you use something for both business and personal, you need a fair split. If you use a ladder on site and at home, only the business part counts.
Buying Business Assets: The Big Tools, The Small Gear
You’ve spent money buying assets: drills, vans, loads of gear. Great. The trick is using the right rules to reduce your tax.
What’s Current in 2025
The big scheme known as temporary full expensing has ended. But the rules for small businesses using the simplified depreciation system still apply, especially the so-called Instant Asset Write‑Off.
From 1 July 2024 to 30 June 2025, eligible businesses (turnover under $10 million using simplified depreciation rules) can immediately deduct the full cost of assets costing under $20,000 per item, new or second-hand.
That means if you buy a new generator for $18k and install it ready for use this year, you could claim the whole lot. If you buy a more expensive asset, you’ll need to depreciate it over time.
What Counts as an Asset for Tradies
Here are some common examples you can claim:
- Power tools (drills, saws, sanders, grinders)
- Larger equipment (concrete mixers, pressure cleaners, blowers)
- Business vehicles (utes, vans, trailers) subject to vehicle rules
- Office gear (computer, tablet, software) used for business
- Safety gear (hi-vis vests, steel-capped boots, site lights, goggles)
- Consumables (tape, bolts, oil, replacement belts)
- Worksite storage & shelving
If you’re buying a kit or set of tools that cost over $100, you need to look at how they’re grouped or treated as a set. If it’s partly for home use, you’ll need to work out the business portion.
Pro Tax Tip: Buy before 30 June and make sure it’s installed and ready for use. That timing often matters for claiming in this tax year.
Vehicle and Ute Deductions: The Tradie Workhorse
Your ute or van is your workmate. You use it to carry gear, get to site, collect materials. So yes, you can claim a stack of vehicle expenses. But as with tools, you need to play by the rules.
What You Can Claim
Typical vehicle running costs include:
- Fuel and oil
- Repairs and servicing
- Insurance and registration
- Interest on loan / lease payments
- Depreciation (or write-off) of vehicle value
- Tyres and tyres replacement
Which Method to Use?
You generally have two methods:
- Cents-per-kilometre method — simpler; you claim a set rate per kilometre (up to 5,000 km).
- Logbook method — more paperwork but can get you more if you use the vehicle a lot and keep good records.
Car Limit for Depreciation
For 2024-25 the car limit for fuel efficient passenger vehicles (which many tradies use) is $69,674. If you buy a vehicle above this threshold you’re limited in what you can deduct.
Pro Tax Tip: Keep a 12-week logbook showing how much is business vs private. It’s the best way to prove your claim and get the maximum deduction.
Employee Tradies: Yes You Can Still Claim Something
If your boss pays you but you spend your own money on gear, you’re still eligible to claim. The rules are straightforward:
- You spent the money yourself (and weren’t reimbursed).
- The expense relates directly to your job (and not just general living costs).
- You kept proof (receipts, invoices, etc.).
Examples: you purchased your own steel-cap boots, sunscreen for outdoor work, union fees, or even a work-specific training course.
Pro Tax Tip: Even if you only use gear partly for work, record the % work use. If your phone bill is 60% work-related, claim 60%.
Safety, Protective Clothing & Site Gear: Not Just Nice to Have
Being a tradie means risk. Hi-vis vests, steel-capped boots, safety goggles, and sun protection aren’t luxuries, they’re necessities. The ATO recognises that.
- High-vis shirts, steel-capped boots, gloves are deductible.
- Sunscreen, hats, sunglasses, if you’re working outside in the sun.
- Tools: If cost is under ~$300 you may claim immediately; if part of a set, might need depreciating.
Pro Tax Tip: If you buy three boots, two hi-vis shirts and gloves as “gear”, keep separate receipts. If it’s bundled into gear that costs over $1000, you may need to treat it differently.
Digital Tools, Office Gear & Remote Quotes: The Modern Tradie
These days you’re quoting jobs on your phone, using site-planning software, scheduling jobs on an app. All that counts as business use. You can claim:
- Mobile phone and data plan (pro-rated for business use)
- Laptop, tablet, accessories
- Software (job management, quoting, cloud storage)
- Website domain, hosting if you manage business online
If you run your own small business, you might also claim part of your home office costs (electricity, internet), as long as you use a designated space and keep reasonable records.
Pro Tax Tip: Keep good records. A photo of the receipt, and a note of business-use % goes a long way.
Record-Keeping: The Tradie Way (Less Shoebox, More Digital)
Look, we get it: you’d rather be on site than sorting receipts. But the ATO doesn’t care how busy you are if you can’t show your records, you may miss out.
Here’s what you should keep:
- Receipts & tax invoices (physical or scanned)
- Logbook for vehicle or gear if used for personal & business
- Proof of installation/use-ready date for big assets
- Bank or credit-card statements (for second proof)
- Business vs personal use calculations
Keep your records for at least five years after you lodge your return.
And yes, a photo on your phone counts. ITP accountants often say: “If it’s blurry, scan it again.”
Common Mistakes Tradies Make + How to Avoid Them
Mistake #1: Mixing private & business costs
If you use your ute to pick up the kids, that portion is private. You only claim the business miles.
Mistake #2: No logbook for vehicle
Without one, you might default to the lesser cents-per-km method and lose out.
Mistake #3: Buying just after 30 June
Remember: to claim in the 2024-25 year, the asset must be purchased, used (or installed ready for use) by 30 June 2025. If not, you may need to wait until next year.
Mistake #4: Under-claiming small items
Those little things (replacement drill bits, tape, oil) add up. Many tradies forget them.
Mistake #5: Not getting help
Tax rules change. The instant asset write-off has shifted. If you assume old rules apply you could miss big deductions.
New & Emerging Things Tradies Should Know in 2025
Instant Asset Write-Off Threshold
As mentioned, $20,000 per asset is the cap for 2024-25 for eligible small businesses.
If you go above that, you’ll move into the small business pool: 15% first year, 30% each subsequent year.
Assets Costing $300 or Less
If you’re an employee and buy a depreciating asset for work use, and it costs $300 or less, you may claim the full cost in the same year provided it’s used mostly for income earning and not part of a set.
Digital & Remote Work
More tradies are quoting jobs from their home office or tablet on site. Make sure you claim the business-use portion of devices and software.
Stay Alert for Legislative Changes
These rules don’t stay still. The ATO may adjust thresholds, eligibility or methods. If your turnover creeps over $10 million, or your business structure changes, you may lose eligibility for simplified depreciation.
What to Do Today (Yes, Today)
- List your gear acquisitions (last 12 months): tools, vehicles, gear.
- Check purchase dates & usage: Was it installed/used this year?
- Work out business vs private use: How much is purely for business?
- Sort your records: Receipts, invoices, logbooks, photos.
- Book an appointment with ITP: Ask for a tradie-tax review. We’ll go through your numbers and make sure you’ve got every deduction you’re entitled to.
- Plan next purchases: If you’re thinking of buying gear before 30 June 2025, now’s a good time to decide so you don’t miss out.
Don’t Let Money Slip Through the Cracks
Tax time might not be your favourite chore — we know you’d rather be on site than stuck in spreadsheets. But it’s a real opportunity to reclaim money you’ve already spent doing the hard yards.
The team at ITP Accounting Professionals has helped everyday Aussie tradies make the most of their deductions for over half a century. Whether it’s a new drill, a ute upgrade, or those safety boots you paid for out of pocket if you bought it to make money, you should claim it.
Disclaimer: The information in this article is for general guidance only and may not apply to your specific tax situation. Always seek professional advice from a qualified tax accountant before making financial or business decisions.