What is the $1,000 standard deduction in Australia?

From 1 July 2026, all Australian resident taxpayers can claim a $1,000 standard deduction for work-related expenses without needing to keep receipts. It reduces your taxable income by $1,000, with the actual tax saving depending on your marginal tax rate. For example, someone in the 30% bracket saves $300.

Who can claim the $1,000 standard deduction?

The $1,000 standard deduction is available to ALL Australian resident taxpayers. It is not means-tested — there is no income limit. However, foreign residents and working holiday makers may not be eligible. You choose either the standard deduction OR your actual work-related deductions, not both.

Should I take the standard deduction or claim actual deductions?

If your total work-related deductions are less than $1,000, take the standard deduction — it's simpler and saves you more. If your actual deductions exceed $1,000 (e.g., significant uniform costs, tools, travel, or working from home expenses), claim your actual deductions instead. The breakeven point is exactly $1,000.

How much tax does the $1,000 standard deduction save?

The tax saving equals $1,000 multiplied by your marginal tax rate. At 15% it saves $150, at 30% it saves $300, at 37% it saves $370, and at 45% it saves $450. If your income is below $18,200 (tax-free threshold), the standard deduction provides no tax benefit.

When does the $1,000 standard deduction start?

The $1,000 standard deduction takes effect from 1 July 2026 for the 2026-27 financial year. It will first apply when you lodge your 2026-27 tax return (due by 31 October 2027, or later if using a tax agent).

Do I still need to keep receipts if I take the standard deduction?

No. If you choose the $1,000 standard deduction, you do not need to keep receipts for work-related expenses up to $1,000. This is one of the main benefits — it simplifies tax time for millions of Australians who previously kept receipts for small claims.

$1,000 Standard Deduction Calculator Australia 2026-27

Australia's new $1,000 standard deduction starts from 1 July 2026. No receipts needed — it automatically reduces your taxable income by $1,000. Use this calculator to see how much you'll save and whether you should take the standard deduction or claim your actual work-related expenses instead.

Last verified: 1 July 2025

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General information and estimates only — not financial, tax, or legal advice. Always verify with a licensed adviser or the ATO.

$1,000 Standard Deduction Calculator Australia 2026-27

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