Tax Deductions for Doctors and Medical Professionals in Australia: 2026–27 Guide

Doctors and medical professionals often incur significant expenses in maintaining their registration, professional knowledge and ability to perform their work. AHPRA registration fees, professional indemnity insurance, continuing professional development, medical equipment and travel between workplaces may be deductible, but each expense must have a clear connection with earning assessable income.

The correct tax treatment also depends on how you work. A salaried hospital doctor claims eligible employment expenses in an individual tax return, while a practitioner operating a private practice records eligible business expenses against practice income. Locums and contractors may also need to consider GST, business structures and the Personal Services Income rules.

Understanding these differences is essential when preparing a doctor tax return in Australia.

Start with the Three Basic Deduction Rules

To claim an employment-related deduction, you must generally:

1. Have paid the expense yourself without being reimbursed.
2. Have incurred the expense in earning your employment income.
3. Keep appropriate records, usually receipts, unless a specific exception applies.

If an expense has both work and private use, only the work-related portion can be claimed. An expense that is private, domestic or capital in nature is not automatically deductible simply because it helps you perform your job.

Receiving an allowance does not automatically create a deduction. The expense must independently satisfy the deduction rules, and the amount deductible may be different from the allowance received. Employer reimbursements are generally not included as income, but the reimbursed expense cannot also be claimed as a deduction. 

AHPRA Registration, Memberships and Professional Insurance

Annual fees paid to maintain professional registration for your existing medical work may generally be deductible. This may include relevant AHPRA registration fees and annual practising fees.

Fees paid to medical colleges, unions and professional associations may also be deductible where the membership relates to your current income-earning activities.

Professional indemnity insurance connected with your medical duties is generally deductible. Income-protection insurance premiums may also qualify where the policy is designed to replace assessable income. However, packaged policies require careful review because premiums relating to life insurance, trauma cover or capital benefits are generally not deductible.

Initial registration, admission and qualification costs incurred to enter the medical profession are usually treated differently. These costs may be private or capital in nature because they place the person in a position to begin earning professional income, rather than maintaining an existing income-earning activity.

CPD, Conferences and Self-Education

Continuing professional development is a common expense for medical professionals. Course fees, clinical seminars, medical journals, professional subscriptions and conferences may be deductible where they maintain or improve the knowledge and skills used in your current work.

The connection with your existing duties must be present when the expense is incurred. Study undertaken to qualify for a new profession, secure a new role or move into a substantially different income-earning activity is generally not deductible merely because it may lead to higher income in the future.

Eligible costs may include personally paid registration fees, textbooks, stationery, internet use and travel directly connected with the training. Employer reimbursements and private components must be excluded. HECS-HELP repayments and government-supported tuition do not receive the same treatment as personally paid deductible course fees.

Where a medical conference is combined with a holiday, the travel and accommodation expenses must be reviewed carefully. A private extension to the trip is not deductible, and mixed-purpose costs may need to be apportioned.

Travel Between Hospitals, Clinics and Other Workplaces

Ordinary travel between home and a regular workplace is usually private. This remains the case when the workplace is some distance away, the doctor works outside normal hours or is rostered on call.

A deduction may be available for travel directly between separate workplaces. For example, a doctor may travel from a hospital to a private clinic, between different hospitals for the same employer, or to another location while performing employment duties.

Travel from home may qualify in limited circumstances if the doctor is required to carry bulky equipment that is essential for work, awkward to transport and cannot be securely stored at the workplace. Carrying ordinary medical items, a laptop or a small work bag is unlikely to satisfy this exception. 

Where eligible, car expenses may be calculated using the applicable cents-per-kilometre or logbook method. Parking, tolls, airfares and accommodation must have a genuine work connection and be supported by appropriate records. Traffic and parking fines are not deductible.

Clothing, Medical Equipment and Working from Home

Ordinary clothing is generally private, even when an employer expects a professional appearance. Business suits, conventional shoes and other everyday clothing are not deductible simply because they are worn at a hospital or clinic.

Eligible claims may include protective clothing, occupation-specific clothing that is not suitable for everyday use, and a compulsory registered uniform. Laundry expenses may be claimable where the clothing itself qualifies. Personally purchased protective equipment may also be deductible where it protects against a real and likely workplace risk and has not been provided or reimbursed by an employer. 

Doctors may claim the work-related use of medical instruments, computers, phones, software and reference materials. An employee may generally claim an eligible work-related item costing $300 or less immediately. More expensive equipment is usually claimed progressively through decline in value. Private use must be excluded.

Working-from-home deductions may be available where a doctor performs substantive employment duties at home, such as preparing reports, reviewing patient material or completing required administration. Occasional checking of emails or taking calls is not necessarily sufficient. The doctor must incur additional running expenses and maintain the records required under the chosen calculation method. 

The New $1,000 Standard Deduction from 1 July 2026

A major change from the 2026–27 income year is the introduction of a standard deduction of up to $1,000 for eligible work-related expenses. It is also referred to as the $1,000 instant tax deduction.

Eligible Australian tax residents who earn assessable labour income may receive the standard deduction without having to prove that they incurred $1,000 of work-related expenses or retain receipts for the standard amount. The maximum deduction is the lesser of $1,000 and the person’s assessable labour income. It reduces taxable income and is not a $1,000 refund or rebate. 

The standard deduction is automatically applied if the taxpayer is eligible. Other work-related expense claims generally reduce the available standard deduction, subject to specified exceptions. If itemised work-related expenses exceed $1,000, the taxpayer may claim the higher amount under the ordinary rules, but records must support the entire itemised claim, not only the amount above $1,000. 

Union fees and eligible professional association membership fees can be claimed separately without reducing the standard deduction. Eligible income-protection insurance premiums may also be claimed in addition, along with non-work-related deductions such as donations and tax-affairs costs. 

Importantly, the standard deduction:

• applies from the 2026–27 income year;
• does not apply to the 2025–26 tax return;
• applies to eligible labour income rather than business or investment income;
• does not allow the same expense to be claimed twice; and
• does not replace deductions for expenses incurred in operating a private practice. 

Doctors earning both salary and private-practice income must allocate expenses to the correct activity. The same expense cannot be claimed once against employment income and again against business income.

Private Practice, Locum Income and PSI

Doctors working in private practice may incur room or service fees, administration charges, staff costs, medical supplies, accounting fees and other practice overheads. The correct treatment depends on the contractual arrangements, who derives the patient income, who pays each expense and whether any private use is involved.

Income earned mainly from a practitioner’s personal efforts or skills may be Personal Services Income, even where the income is received through a company, trust or partnership. The PSI rules can affect income attribution and restrict certain deductions. Operating through an entity does not automatically permit income splitting or allow profits to remain taxed at the company rate.

Locum doctors should also review whether they are employees or genuine independent contractors, how their income is reported, whether GST registration is required, and whether the PSI rules apply to their arrangements.

Keep Records That Explain the Full Position

Before preparing a tax return, doctors should gather:

• Income statements and allowance details
• Private-practice and locum remittance reports
• AHPRA and professional membership invoices
• Indemnity and income-protection insurance records
• CPD, conference and education receipts
• Vehicle logbooks and travel records
• Equipment and software invoices
• Working-from-home records
• Details of employer reimbursements
• Practice service and administration fee statements

Good records make it easier to compare the $1,000 standard deduction with itemised claims and correctly separate employment, private-practice and personal expenses.

Frequently Asked Questions

Q1. What tax deductions can doctors claim in Australia?

Doctors may be able to claim expenses directly connected with earning their income, including annual professional registration fees, professional memberships, medical indemnity insurance, eligible CPD and self-education, work-related travel, medical equipment, technology and working-from-home expenses.

The deduction available depends on whether the doctor is an employee, contractor, locum or private practitioner. Private use and employer reimbursements must be excluded, and appropriate records are generally required. 

Q2. Are AHPRA registration fees tax deductible?

Annual AHPRA registration fees paid to maintain registration for your current medical work may generally be deductible. Initial registration or qualification costs incurred to enter the medical profession are commonly treated as private or capital in nature and may not be immediately deductible.

Keep the annual registration invoice and evidence of payment with your tax records.

Q3. Can doctors claim professional indemnity insurance?

Professional indemnity insurance premiums may generally be deductible where the policy relates directly to the doctor’s current income-earning activities.

Income-protection insurance may also be deductible where the policy replaces assessable income. However, premiums relating to life insurance, trauma cover or capital benefits are generally not deductible. Combined policies should be reviewed carefully so that only the eligible component is claimed.

Q4. Can doctors claim CPD and conference expenses?

CPD courses, seminars, conferences, medical journals and professional subscriptions may be deductible where they maintain or improve skills used in the doctor’s current employment or practice.

Study undertaken to enter the medical profession, qualify for a new occupation or move into substantially different income-producing work is generally not deductible. Travel combined with a private holiday must also be apportioned, and employer-reimbursed costs cannot be claimed.

Q5. Can a doctor claim travel between hospitals and clinics?

Travel directly between separate workplaces may be deductible. For example, a doctor travelling from a hospital to a private clinic, from one hospital to another or to an alternative workplace while performing employment duties may have an eligible claim.

Ordinary travel between home and a regular workplace is generally private, even where the doctor works after hours, is on call or travels a long distance. Limited exceptions can apply where essential bulky equipment must be transported and secure storage is unavailable at the workplace.

Q6. Can doctors claim car expenses?

Doctors may be able to claim eligible work-related car expenses using the applicable cents-per-kilometre or logbook method.

The cents-per-kilometre method requires a reasonable basis for calculating work-related kilometres and is subject to the applicable limit. The logbook method requires a valid logbook, odometer records and supporting evidence for vehicle expenses.

Normal travel between home and a regular workplace is generally not deductible. If the car is used privately, that portion must be excluded.

Q7. Are medical scrubs and work clothing tax deductible?

Conventional clothing is generally not deductible, even where a hospital or medical practice expects a professional appearance.

A deduction may be available for protective clothing, occupation-specific clothing unsuitable for everyday use, or a compulsory registered uniform. Laundry expenses may also be claimed where the clothing itself qualifies.

Ordinary trousers, shirts, suits and shoes are generally private expenses.

Q8. Can doctors claim medical equipment and technology?

Doctors may be able to claim the work-related use of medical instruments, computers, mobile phones, software, tablets and reference materials.

For employees, an eligible item costing $300 or less may generally be claimed immediately if the relevant conditions are satisfied. More expensive assets are usually claimed progressively through decline in value. Any private use must be excluded.

Equipment supplied or reimbursed by an employer cannot also be claimed by the doctor.

Q9. Can doctors claim working-from-home expenses?

A working-from-home deduction may be available where a doctor performs substantive employment duties at home, such as preparing clinical reports, reviewing patient information, completing required administration or undertaking eligible professional work.

The doctor must incur additional running expenses and maintain records under the chosen calculation method. Minimal tasks, such as occasionally checking emails or answering a brief telephone call, may not be sufficient.

Q10. Does receiving an allowance automatically create a deduction?

No. An allowance does not automatically make the related expense deductible.

The expense must independently satisfy the usual deduction rules. Depending on how the allowance is reported, it may need to be included as income. The deductible expense may be less than, equal to or greater than the allowance received. 

Q11. Can doctors claim expenses reimbursed by an employer?

No. If an employer or medical practice reimburses a doctor for an expense, the doctor generally cannot claim the same expense as a tax deduction.

Doctors should clearly distinguish between allowances and reimbursements when preparing their tax returns.

Q12. How does the new $1,000 standard deduction affect doctors?

From the 2026–27 income year, eligible Australian tax residents earning assessable labour income may receive a standard deduction of up to $1,000 for covered work-related expenses.

The standard deduction:

• is not a $1,000 refund or rebate;
• does not apply to the 2025–26 tax return;
• may be reduced where the taxpayer claims other covered work-related expenses;
• does not replace deductions for private-practice business expenses; and
• should be compared with itemised claims where actual eligible expenses exceed $1,000.

Eligible professional association fees and income-protection insurance premiums may be claimed separately under the relevant rules.

Q13. Does the $1,000 standard deduction apply to private-practice expenses?

No. The standard deduction applies to eligible labour income and does not replace deductions for expenses incurred in carrying on a private practice or other business.

Doctors who earn both salary and private-practice income need to allocate their expenses correctly. An expense cannot be claimed against employment income and then claimed again against private-practice income.

Q14. Can a locum doctor claim business expenses?

A locum doctor may be able to claim costs connected with earning locum income, including eligible professional fees, indemnity insurance, equipment, accounting costs and work-related travel.

The treatment depends on whether the doctor is engaged as an employee or contractor, the contractual arrangement, who pays the expense and whether reimbursement is received. Locums may also need to consider GST registration, business structure and Personal Services Income rules.

Q15. Do the Personal Services Income rules apply to doctors?

They can. Income earned mainly as a reward for a doctor’s personal efforts or professional skills may be Personal Services Income, even where it is received through a company, trust or partnership.

Where the PSI rules apply, they may attribute income to the individual practitioner and restrict certain deductions. For example, limitations can apply to home occupancy expenses and payments to associates for non-principal work. Operating through a company does not automatically allow income splitting or retention of profits at the company tax rate. 

Q16. What records should doctors keep for their tax returns?

Doctors should retain records such as:

• income statements and allowance details;
• private-practice and locum remittance reports;
• AHPRA registration invoices;
• professional membership receipts;
• indemnity and income-protection insurance statements;
• CPD and conference invoices;
• vehicle logbooks and travel records;
• medical equipment and software invoices;
• working-from-home records;
• practice service-fee statements; and
• details of employer or practice reimbursements.

Records should explain what was purchased, how much was paid and how the expense related to earning income.

Q17. How can Kintax Accountants assist doctors and medical professionals?

Kintax Accountants assists doctors, specialists, locums and other medical professionals with:

• individual and contractor tax returns;
• work-related deduction reviews;
• private-practice accounting;
• GST and BAS compliance;
• practice service-fee accounting;
• business structures;
• Personal Services Income reviews;
• capital gains tax; and
• year-round tax planning.

Tax and Accounting Support for Medical Professionals

Kintax Accountants assists doctors, specialists, locums and other medical professionals with individual tax returns, private-practice accounting, GST and BAS, business structures, PSI reviews and year-round tax planning.

Contact Kintax Accountants

Phone: 0399393692

Email: info@kintax.com.au

Office: Level 1, 287A Spring Street, Reservoir VIC 3073

Enquiries: Request a consultation

Based in Reservoir, Kintax Accountants supports medical professionals throughout Melbourne’s northern suburbs and greater Melbourne.

Important information: This article provides general tax and accounting information only. It does not constitute personal tax, financial or legal advice. Deductibility depends on your employment arrangements, private-practice activities, reimbursements, record keeping and individual circumstances. Professional advice should be obtained before acting on this information.