Doctors have some of the highest incomes in Australia, but they also face a long list of professional costs — indemnity insurance, registration, CPD, conferences, equipment, journals, travel and, for many practitioners, the costs of running a practice.
The good news is that many of these expenses can be tax deductible.
The challenge is knowing what you can claim, what you cannot, and which rules apply to you as an employee, contractor or practice owner.
This guide covers the main tax deductions doctors should understand for the 2026–27 financial year.
Important: Tax treatment depends on your employment and business arrangements. This article provides general information and is not personal tax advice.
How Much Tax Do Doctors Pay in Australia?
For the 2026–27 income year, Australia’s top individual marginal tax rate is 45% on taxable income above $190,000, with the 2% Medicare levy generally applying as well.
That means a deduction is not simply about “getting money back”. A $1,000 legitimate deduction may reduce taxable income by $1,000, with the actual tax saving depending on your marginal rate.
Doctors earning substantial income should also understand Division 293 tax, which can reduce the tax concession on concessional super contributions when your Division 293 income and relevant concessional contributions together exceed $250,000. The additional tax is generally 15% of the lesser of the excess over $250,000 or the relevant concessional contributions.
The Basic Rule for Doctor Tax Deductions
For most work-related deductions, three questions matter:
- Did you pay the expense yourself?
- Is it directly connected with earning your income?
- Can you support the claim with appropriate records?
Private expenses are generally not deductible, and an expense that your employer reimburses cannot simply be claimed again.
For doctors, the biggest difference often comes from how you earn your income.
A salaried hospital doctor, a GP employed by a medical practice, a locum contractor and a doctor running their own practice can have very different deduction positions.
Common Tax Deductions for Doctors
Medical Equipment and Professional Tools
Doctors may be able to claim eligible equipment they personally purchase for income-producing activities, such as:
- stethoscopes
- diagnostic equipment
- specialised clinical tools
- computers and tablets used for work
- medical equipment used in private consulting
- equipment used for qualifying self-education.
The treatment can depend on the cost of the asset and whether you use it privately.
For expensive equipment, you may need to claim the decline in value over time rather than deducting the entire purchase price immediately.
Medical Indemnity Insurance
Professional indemnity insurance is an important cost of practising medicine.
Where you personally incur the premium and it relates to your income-producing medical activities, it can generally be deductible.
This can be particularly relevant to doctors who work across multiple practices, hospitals or contracting arrangements.
Professional Memberships and Registration
Professional and industry association expenses can potentially be deductible where they have a sufficient connection with your income-producing activities.
Examples can include eligible:
- professional association memberships
- specialist college subscriptions
- professional journals
- work-related registration and licence costs.
Keep the distinction between a professional expense and a private membership or expense that does not have the necessary connection to your work.
Medical Journals, Databases and Reference Material
Doctors often pay for subscriptions to clinical journals, online databases and specialist reference material.
These can generally be deductible when they are sufficiently connected with your current income-earning activities.
The same principle applies to medical textbooks and other professional reference material.
Self-Education, CPD and Conferences
This is one of the most valuable areas for doctors to understand.
A work-related course, conference or seminar can potentially be deductible where it has a sufficient connection with your current employment activities — for example, where it maintains or improves the skills and knowledge you use in your current role.
The ATO confirms that qualifying self-education expenses can include course and conference fees, relevant transport, and accommodation and meals where the education requires you to be temporarily away from home overnight.
This can cover expenses such as:
- CPD conferences
- specialist seminars
- relevant online medical education
- professional training
- eligible examination or assessment costs
- technical training connected with your current role.
The important distinction is current income-producing skills versus entering a new income-earning field.
For example, additional training that improves a surgeon’s existing clinical skills is very different from studying a qualification that enables someone to move into an entirely new profession.
International Conferences and Medical Travel
International medical conferences can be deductible, but being a medical conference does not automatically make the entire trip deductible.
The work-related purpose needs to be genuine, and private travel must be separated from the deductible component.
If you add a holiday before or after a conference, for example, the private portion of flights, accommodation and other expenses generally cannot simply be claimed as a business expense.
Keep the conference program, registration confirmation, itinerary and receipts so you can demonstrate the work-related purpose of the trip.
Home Office Deductions for Doctors
Many doctors now perform administrative work from home, including:
- writing reports
- completing clinical administration
- reviewing records
- research
- telehealth-related work
- practice management
- preparation for consultations.
For eligible taxpayers using the ATO’s fixed-rate method, the rate is currently 70 cents per hour for working from home from 1 July 2024, subject to the method’s requirements and record-keeping rules.
The fixed rate covers certain running expenses, so you should not simply claim the same electricity, internet and phone costs again on top of it.
A separate claim may be available for certain assets and expenses that are not covered by the fixed rate.
The alternative actual-cost method can be more appropriate in some circumstances, particularly where you have significant eligible home-working expenses.
Vehicle and Travel Deductions for Doctors
Travel deductions are frequently misunderstood.
Travel between two workplaces on the same day can generally be deductible.
For example, a doctor travelling from a hospital to a separate private consulting location may be able to claim the relevant work-related travel.
By contrast, ordinary travel from home to your regular workplace is generally private.
Being on call does not automatically change that outcome.
Where a doctor is required to carry specialised equipment and the circumstances meet the relevant rules, different treatment may apply. This is an area where the exact employment and on-call arrangements matter.
The 2026–27 Car Rate
For the 2026–27 income year, the cents-per-kilometre method uses a rate of 91 cents per kilometre, with a maximum of 5,000 work-related kilometres per car.
Alternatively, doctors who use their own car substantially for work may consider the logbook method.
There is no universal percentage at which one method becomes “better”. The right choice depends on your actual work-related kilometres, vehicle costs and circumstances.
Locum Doctors: When Are Travel Costs Deductible?
Locum doctors need to be especially careful here.
A doctor travelling temporarily for work may be able to deduct eligible travel, accommodation and other expenses where the travel has the necessary connection with earning income.
But you cannot assume that every cost incurred while working away from home is deductible.
The distinction between temporary work travel and establishing or maintaining a new regular place of work matters.
Before claiming a significant locum travel expense, consider:
- where your normal work base is
- how long the assignment lasts
- whether the location has become a regular workplace
- who pays for the accommodation
- whether the expense has a private component.
This is one of the areas where personalised tax advice can prevent an otherwise legitimate deduction from being overstated.
Employee Doctor vs Contractor vs Practice Owner
Your structure matters.
Salaried doctor
A salaried hospital doctor or registrar generally claims eligible work-related expenses personally incurred and not reimbursed by the employer.
For the 2026–27 income year, eligible Australian resident employees with assessable labour income can also benefit from the new standard deduction of up to $1,000 for work-related expenses.
This is important, but it is not an extra $1,000 refund. It is a deduction against taxable income, and its calculation interacts with relevant actual work-related deductions.
Independent contractor
Contractors generally need to consider their business income and expenses under the rules applying to their particular structure.
The new $1,000 standard deduction is not a general business-expense shortcut for independent contractors earning only business or self-employment income.
Contractors should instead consider deductible business expenses, depreciation, GST and their personal services income position.
Doctor running a medical practice
A doctor operating a practice may have a much broader set of business expenses, potentially including:
- practice rent
- staff costs
- software
- accounting fees
- practice insurance
- equipment
- marketing
- bookkeeping
- professional services
- technology
- depreciation.
If you are operating through a company, trust or partnership, the structure needs to be reviewed alongside the tax treatment.
The Personal Services Income Rules for Doctors
This is where medical practice structures can become complicated.
A company or trust does not automatically allow a doctor to split professional income with family members and pay less tax.
Where income is personal services income (PSI), the PSI rules can attribute income back to the individual who performed the services unless the relevant personal services business requirements are satisfied.
The 80% rule is important, but it is only part of the broader PSI framework. For example, a personal services business may need to satisfy the results test, or another relevant test together with the 80% rule.
For doctors working through an agency, the PSI source can also be the agency rather than each individual end client.
This makes structure planning a specialist area rather than a simple “set up a company and split the income” exercise.
Superannuation for High-Income Doctors
Super is another major planning area for doctors.
The concessional contributions cap is $30,000 per financial year, including employer superannuation, salary sacrifice and eligible personal deductible contributions.
Where you have unused concessional cap amounts from previous years and meet the eligibility requirements, you may be able to use the carry-forward provisions to contribute more than the annual cap.
This can be particularly useful after:
- parental leave
- a career break
- a major increase in income
- becoming a practice owner
- receiving a large one-off payment.
However, high-income doctors need to consider Division 293 before making large concessional contributions.
KSH TAX also has a practical guide to salary sacrifice and superannuation if you want to explore how salary packaging can fit into a broader tax strategy.
What About the New $1,000 Standard Deduction?
For 2026–27, eligible Australian residents earning assessable labour income can receive a standard deduction of up to $1,000 for certain work-related expenses.
For doctors, this is most relevant to those earning income as employees.
It should not be treated as “$1,000 on top of everything else”.
The legislation reduces the standard deduction by relevant work-related deductions covered by the new rules. Some categories, such as eligible professional association fees and certain other deductions, can sit outside the standard deduction.
Doctors with substantial actual expenses should therefore compare the standard deduction with their actual position rather than assuming the new $1,000 figure is automatically the best option.
Records Doctors Should Keep
Good records are especially important where your deductions are large or your work arrangements are complex.
Keep:
- invoices and receipts
- conference registration and programs
- CPD records
- professional membership statements
- indemnity insurance documents
- travel records
- vehicle logbook records where applicable
- home-working records
- evidence supporting private-use apportionments
- depreciation records for larger assets.
For international conferences and locum travel, keep enough documentation to show the purpose, dates and work-related connection of the expenditure.
Don’t Leave Your Medical Deductions Until Tax Time
For doctors, tax planning is often more valuable than simply trying to find another deduction after 30 June.
Your income structure, super contributions, practice expenses, equipment purchases, PSI exposure and investment position can all interact.
KSH TAX works with professionals on tax returns, tax planning and broader financial structures.
Our tax returns service covers individual deductions and return preparation, while our tax planning is designed for higher-income professionals who want to make decisions before the financial year closes.
For doctors operating through a practice, it can also be worth reviewing the structure before making major changes rather than waiting until tax time.
Talk to a Medical Accountant About Your Tax
The most valuable deduction is not necessarily the biggest one.
It is the deduction that is legitimate, properly supported and appropriate for the way you actually earn your income.
Whether you’re a registrar, GP, specialist, locum or medical practice owner, we can help review your deductions, structure and tax position – book a consultation or call us on 08 6285 8110.
