The proposed reform is designed to cut down on paperwork, reduce reliance on professional tax advice, and deliver cost-of-living relief.

Who would be eligible?

Taxpayers whose work-related expenses exceed $1,000 can still itemise and claim them individually.

According to Labor, more than one in three Australians currently claim under $1,000 in deductions and would benefit from the simplified process.

How will it work?

The government says these taxpayers would be able to complete their return in as few as six clicks, saving time and effort. However the automatic deduction will only be available for taxpayers claiming less than $1,000 with the existing process remaining in place for those who lodge higher claims.

“The bigger concern is that I think the proposal should be expanded in time, to embrace a bigger percentage of people to enable them to get rid of the necessity to provide, keep and be able to produce receipts as a whole.”

How much could you save?

For those earning between $45,001 and $135,000, the benefit could be as much as $320.