Tax can feel complex and time-consuming, particularly for interns and resident doctors navigating the early years of hospital practice. Between overtime, study commitments and ongoing professional development, it’s easy to overlook legitimate deductions that could reduce your tax owed.
The good news is that many of the expenses interns and resident doctors incur throughout the year may be tax deductible. By understanding what you can claim and keeping good records, you may be able to significantly reduce your taxable income.
With the end of the financial year approaching, now is a good time to start compiling receipts and records to ensure you don’t miss valuable deductions when it’s time to lodge your tax return.
Why early-career doctors often have deductible expenses
During internship and residency, doctors commonly incur professional expenses as part of maintaining their qualification, improving their skills, meeting training requirements and performing their day-to-day duties. These costs can range from licensing fees and professional memberships to equipment, clothing and work-related travel.
However, not every expense is automatically deductible. To claim a deduction, the expense needs to be directly related to earning your income, you have spent the money yourself and not been reimbursed and you have a record to prove the expense.
Common tax deductions for interns and resident doctors
1. Annual practising certificate fees and professional costs
Maintaining your registration is an essential part of working as a doctor, and many of the associated costs may be tax deductible.
For example, annual practising certificate fees are typically claimable because they are required to practise medicine. Similarly, certain professional expenses related to your employment, such as medical equipment used for work, may also be deductible.
2. Books and professional resources
Interns and resident doctors often purchase medical textbooks, online subscriptions, guidelines and exam resources to support clinical work and ongoing learning.
In some cases, these items may be deductible. Generally, books or journals costing $300 or less may be claimed if they are used at least 50% for work purposes. These resources must be directly relevant to your current role or responsibilities.
3. Car expenses and travel
Car expenses are one area where confusion often arises. In most situations, travel between your home and your regular place of work is considered private and non-deductible.
However, there are limited circumstances where travel may be claimable. For example, if you are required to transport bulky medical equipment that is essential for your duties and there is no secure storage at your workplace, the travel may be deductible.
Because these rules can be complex, it is important to keep accurate records and seek advice if you are unsure about whether a particular trip qualifies for deduction.
4. Clothing and protective gear
Certain clothing expenses may be deductible for doctors. Occupation-specific clothing, such as scrubs that are not suitable for everyday wear, as well as protective clothing used in the course of your work may quality as a deduction. This can include items designed to protect you from injury or contamination while performing your duties.
However, conventional clothing that can be worn outside of work is generally not deductible, even if you wear it during your job.
5. Self-education and professional development
Ongoing education is a key part of a medical career, and many training-related expenses may be tax deductible when they relate directly to your current role.
According to the ATO, self-education expenses may be claimable if the study:
- Maintains or improves the skills and knowledge you need for your current duties
- Results in or is likely to result in an increase in income from your current employment
This can include the cost of seminars, conferences and training courses that are directly relevant to your role as an intern or resident doctor.
6. Superannuation contributions
Making additional contributions to your superannuation may also provide tax advantages for some doctors. However, contribution rules and limits can be complex, so it is important to seek professional advice before making additional contributions.
Speaking with a financial adviser can help you determine whether this strategy is appropriate for your circumstances.
Why using an accountant can make a difference
While it is possible to lodge your own tax return, many early-career doctors choose to work with an accountant to ensure their return is accurate and that all available deductions are considered.
In addition to providing professional guidance, using a registered tax agent may also provide additional time to lodge your tax return. In many cases, taxpayers who lodge through an accountant may be eligible for a lodgement extension to May 2027.
This can be particularly helpful if you have a tax bill as it provides additional time before payment is required.
Talk to Prosperity’s taxation experts
Managing your tax obligations while balancing the demands of a medical career can be challenging. Our advisers work with interns, resident doctors and other early‑career doctors to simplify the process and ensure their tax position is managed effectively.
Don’t miss any valuable deductions in your next tax lodgement. Get in touch with Aidan from the Prosperity Health team to maximise your tax return.
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Associate Director
avuocolo@prosperity.com.au |
