I've always claimed $300 of work expenses without receipts — can I still do that in 2026–27?

For years the routine was the same. You did your own return, put $300 at work-related expenses because everybody knew you could claim that much without receipts, and nothing ever came of it.

From 1 July 2026 that line no longer exists. The exception it relied on has been repealed outright, and on 26 August the ATO published its first draft ruling on what took its place. The replacement is bigger. It also does not behave the way the $300 rule did, and the difference decides whether keeping receipts this year is worth anything to you.

The $300 rule and the $150 laundry rule are both gone

Two substantiation exceptions that a generation of taxpayers learned by heart stop applying from the 2026–27 income year. The first allowed work expenses totalling $300 or less to be claimed without written evidence — former section 900-35 of the Income Tax Assessment Act 1997. The second allowed laundry expenses of $150 or less to be claimed without written evidence. A third, covering certain transport expenses paid under an industrial instrument in force on 29 October 1986, has gone with them, and the definitions of award transport payment, transport payment and laundry expense have been removed from the Act.

They were repealed by the Treasury Laws Amendment (Tax Reform No. 1) Act 2026 — the same Act that created the standard deduction. The ATO's stated reasoning is that the exceptions are no longer needed: if you would rather not keep records, you take the standard deduction instead of claiming.

What replaced them, and who gets it

From the 2026–27 income year, section 25-130 gives eligible individuals a standard deduction of up to $1,000 for work-related expenses. You do not have to have spent the money, and you do not have to substantiate anything. You do not even have to claim it — the ATO works the amount out when you lodge, from the income you report at the correct labels.

To be eligible you must be an individual, be an Australian tax resident at any time during the income year, and derive assessable labour income. That last term is defined exhaustively and is narrower than income generally: salary and wages, payments to company directors, payments to office holders in the service of the Commonwealth, a state or a territory, payments to religious practitioners, return-to-work payments, termination and retirement payments, and parental leave pay. Dividend income and business income are not labour income. A sole trader with no wages gets no standard deduction against that business income.

The amount is the lesser of $1,000 and your total assessable labour income for the year. Someone with $650 of wages has a $650 ceiling, not $1,000.

The mechanic that catches people: claiming reduces it, dollar for dollar

This is not the either-or choice it is usually described as. Any work-related expense you claim in your return reduces your standard deduction dollar for dollar, possibly to nil. The ATO's stated purpose is to stop the same expense being deducted twice.

Its own worked example makes the consequence concrete: a person with $650 of labour income who claims $400 of work-related expenses ends up with a standard deduction of $250, and total deductions of $650 — exactly what she would have had by claiming nothing at all. The claiming added nothing and cost her the paperwork.

So if your genuine work-related expenses for the year come to less than $1,000, claiming them gains you nothing. The ATO's example of a teacher entitled to $1,000 who has incurred $700 of expenses has her claim none of them: she takes the $1,000 and never has to substantiate the $700.

If your expenses exceed $1,000, there is a real choice. Claim nothing and take the standard deduction, or claim the lot and let the standard deduction fall to nil. The catch in the second option is substantiation — you must substantiate the full amount claimed, not just the part above $1,000. An $1,100 claim means written evidence for $1,100, not for $100.

One protection is worth knowing. If you claim expenses and they are later found not to be deductible, the ATO may increase your standard deduction back up to what you would otherwise have been entitled to, because the disallowed claim no longer reduces it.

What can still be claimed on top

Some work-related deductions sit outside the standard deduction and do not reduce it: union fees and payments for membership of a trade, business or professional association, and income protection, personal sickness and accident insurance premiums. The ATO's example is a factory worker paying $200 in union fees who is entitled to the full $1,000 — his total deductions are $1,200. These still require written evidence.

Then there is everything that was never a work-related expense in the first place, none of which is touched: gifts and donations, rental property and other investment deductions, the cost of managing your tax affairs, personal super contributions, and expenses incurred in earning business or gig-economy income. Claimed as normal, records as normal.

Two things already being got wrong

The first: that it is $1,000 back. It is not. It is a deduction, which reduces the income you are taxed on rather than the tax itself, and the ATO says plainly that it is not a tax offset or rebate. What it is worth to you depends on your marginal rate.

The second: that receipts no longer matter. They matter more than they did, because the $300 safety net underneath small claims is gone. You generally cannot know until the year ends whether your expenses will finish above or below $1,000 — a single course, a laptop, or a stretch of working from home can push a quiet year over — and the choice is only available if the records exist. The ATO's own advice is to keep written records of expenses during the year and decide at the end.

Laundry now has its own accepted method

The draft ruling also sets out a compliance approach for the hole the $150 rule left. From 1 July 2026 the Commissioner will accept $1 for a full load of work-related laundry and 50c for a mixed load of work and private laundry, covering washing, drying and ironing but not dry cleaning. Its example is a chef who washes 100 full loads of uniform and protective clothing across the year and claims $100.

It is not a return to claiming without records. You need to be able to show the clothing is genuinely deductible under the ATO's existing laundry ruling, how many loads there were and of what kind, and evidence that you actually incurred the costs — electricity, water and detergent. And like any work-related claim, it reduces your standard deduction dollar for dollar.

This is general information current as at 2 September 2026 and not advice about your circumstances. The ruling is a draft — the Commissioner's preliminary view, open for public comment until 9 October 2026, and proposed to apply from 1 July 2026 once finalised, so the detail can still move. The repeal of the $300 and $150 exceptions is not draft. That is already law and already running.

The first return this applies to is the 2026–27 one, lodged from July 2027. The decision it turns on, though, is being made now, in whether you keep this year's receipts at all. If your work expenses are usually well under $1,000, this year is genuinely simpler than last. If they are usually above it — trades, healthcare, anyone consistently working from home, anyone studying — the old $300 habit is now the expensive one. We wrote on 1 July about who the standard deduction suits; this ruling supplies the arithmetic behind that. Individual tax returns are one of our four service areas, and the income tax calculator on this site shows where you sit on the 2026–27 rates while you work out which side of $1,000 you are on.