Proposed — from 2026–27 if legislated

$1,000 Instant Work Deduction Calculator

See whether the flat $1,000 deduction beats claiming your actual work expenses — and what it saves you.

Status: This is a proposed measure. Exposure draft legislation has been released and the Government reconfirmed it in the 2026–27 Budget, to apply from 1 July 2026 — but it is not yet law. Figures are estimates based on the announced design.

From 2026–27, the Government has proposed a $1,000 instant tax deduction: workers could knock up to $1,000 off their taxable income for work-related expenses without keeping a single receipt. You'd simply claim the higher of $1,000 or your actual substantiated expenses. If your real work expenses are under $1,000, the flat deduction puts extra money back in your pocket and saves you the receipt-shoebox hassle. This calculator shows whether you're better off taking the $1,000 — and exactly how much tax you'd save.

$
Please enter your taxable income to calculate.
$
Your usual deductible work expenses with receipts. Enter 0 if you don't normally claim any.
Extra tax saving from the $1,000 instant deduction
$0
Compared with claiming your actual expenses.
Deduction you'd claim
$1,000
Extra deduction gained
$0
Your marginal rate
0%
!

Missing income figure

Please enter your taxable income before calculating — it's the required field.

How the $1,000 instant deduction works

It's a "claim the higher of" choice. When you lodge your 2026–27 return, you can either claim your actual work-related expenses (with records, as now) or take the flat $1,000 instant deduction with no receipts — whichever is larger. If your genuine work expenses already exceed $1,000, you keep claiming them as usual and the instant deduction adds nothing. The benefit only appears when your real expenses are below $1,000, because the flat deduction lifts you up to the full $1,000.

The saving formula
Deduction claimed = the greater of ($1,000, your actual expenses)
Extra deduction = $1,000 − actual expenses (if positive)
Tax saving = extra deduction × your marginal rate (incl. 2% Medicare levy)
Worked example — Dean earns $70,000 and normally claims $300. Extra deduction = $700. At a 32% marginal rate (30% + 2% Medicare), his saving = $700 × 32% = $224 a year.

Who benefits most

The lower your usual work expenses and the higher your marginal rate, the bigger the win. Someone who claims nothing today gets the full $1,000 deduction; at a 30% bracket plus Medicare that's $320 back. The Government estimates around 6.2 million workers — roughly 42% of taxpayers — would benefit, with an average saving of about $205 in 2026–27. Workers in trades, hospitality, retail and admin, who often have modest deductible expenses, tend to gain the most.

IncomeUsual expensesExtra deductionApprox. saving
$45,000$0$1,000~$320
$70,000$300$700~$224
$100,000$600$400~$128
$140,000$1,200$0$0 (claim actual)

Why it isn't a $1,000 refund

A common misread: the $1,000 is a deduction, not a cheque. A deduction reduces your taxable income, so the cash benefit equals $1,000 (or the extra portion) multiplied by your marginal tax rate — typically $150 to $470 depending on your bracket. To see how the underlying brackets work, use the income tax calculator, and check the flow-on to your take-home pay. If you're comparing salary-packaging options, the salary sacrifice calculator pairs well here.

Should you still keep records?

If there's any chance your real work expenses top $1,000 — think tools, a work vehicle, self-education, union fees or working-from-home costs — keep your receipts so you can claim the larger actual amount. The instant deduction is a floor, not a cap. Bundle and total your genuine expenses first; only fall back to the flat $1,000 if you come in under it.

Related calculators

Ad slot — in-content / native

Frequently asked questions

When does the $1,000 instant deduction start?+
It's proposed to apply from the 2026–27 income year — that is, from 1 July 2026 — meaning the return you lodge from July 2027. It was announced at the 2025 federal election and reconfirmed in the 2026–27 Budget, with exposure draft legislation released, but it has not yet been passed into law.
Is it $1,000 back in my pocket?+
No. It's a deduction, not a refund. It reduces your taxable income by up to $1,000, so the actual cash saving is $1,000 (or the extra portion above your usual expenses) times your marginal tax rate — generally between about $150 and $470 depending on your income.
Do I need receipts to claim it?+
No. The whole point of the instant deduction is that you can claim up to $1,000 without keeping records. If your actual work expenses are higher than $1,000 and you want to claim more, you'd need the usual substantiation for the actual amount.
What if my real work expenses are more than $1,000?+
Then you'd claim your actual expenses, as you do now, and the instant deduction gives you no extra benefit. You always claim the higher of the two. The flat $1,000 is a floor for people with low or no work expenses, not a cap on everyone else.
Who can claim the instant deduction?+
It's aimed at workers who earn employment or sole-trader income. The Government estimates about 6.2 million taxpayers would benefit, with an average saving of around $205 in 2026–27. Final eligibility rules will be confirmed when the legislation passes.
Does claiming it affect my HECS or Medicare levy?+
A work-related deduction reduces your taxable income, which can slightly lower income-tested amounts. However, your HECS repayment income adds some items back, so the effect there is limited. This calculator estimates the income-tax-plus-Medicare saving; check study-loan impacts with our HECS calculator.
This calculator provides general estimates only and is not financial or tax advice. The $1,000 instant deduction is a proposed measure that is not yet law and its final design may change. Estimates use the legislated 2026–27 resident tax rates plus the 2% Medicare levy and do not account for offsets such as LITO, study-loan repayments, or individual circumstances. Confirm details with the ATO or a registered tax agent once the measure is enacted.

Scroll to Top