Many people assume their bank statement is enough to support a deduction claim. Unfortunately, that’s not always the case.
What a Bank Statement Shows
A bank statement generally proves:
- A payment occurred
- The amount paid
- The date of payment
What it often doesn’t show is:
- What was purchased
- Why it was purchased
- Whether it was work-related
Why Receipts Matter
Receipts often contain:
- Supplier details
- Description of goods or services
- Purchase amount
- Date of purchase
This extra information helps substantiate your claim.
Examples
A bank statement showing a payment to a department store doesn’t identify whether the purchase was:
- Personal
- Work-related
- Partly deductible
The receipt provides that detail.
Create Better Habits
- Photograph receipts immediately.
- Use expense tracking software.
- Store records digitally.
- Reconcile expenses regularly.
Final Thoughts
Good documentation is one of the simplest ways to protect your deductions and reduce stress at tax time.
If you’d like advice on improving your record-keeping processes, contact the Advisory One team.
Recent Comments