Tax Deductibility of COVID-19 Tests

The federal government is set to make COVID-19 tests tax-deductible for individuals and businesses when they are purchased for work-related purposes.

This will see the costs of purchasing a rapid antigen (RAT) test tax deductable for individuals that are required by their employer to test before being allowed to go to or return to work.

For businesses that purchase RAT tests and supply the tests to their employees to tests prior to arriving or returning to work, the costs associated will now be treated as a business expense. Such costs will also be exempt from fringe benefits tax (FBT) for employers where RAT tests are provided to employees for work related purposes.

RAT tests purchased for other members of the family and for the use close contacts however will not be deemed deductable as the use of those tests is not in connection with the earning of income.

Should you require further information, please do not hesitate in contacting our office.

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