Note: The information in the articles below is of a general nature only. The information may not be relevant to your specific individual circumstances. You may need to engage ezytaxback.com Pty Ltd to provide you with specific advice to suit your specific circumstances.
Are you missing out on tax deductions? With Tax Season in full swing, it is important to remember the little things that might have a huge effect on the result of your Tax Return. To help you get into gear here are some simple tips on how to reduce tax mistakes and get a higher tax return:
Have a deduction strategy
The best way to increase the value of your tax return is through deductions. It may seem like an obvious solution, yet more than 45 per cent of Australians between 25 and 34 fail to claim more than the $300 threshold for their tax returns.
To ensure dollars end up back in your pocket, it’s worth getting to know the items you can and cannot claim for your particular industry or occupation. You can the create a tax deduction strategy. For instance, flight attendants are able to claim rehydrating moisturisers and hair conditioner in order to meet strict grooming requirements. Similarly, police officers required to maintain a high level of fitness for their position can claim gym membership and the cost of travelling directly from the workplace to the location of exercise.
Currently individuals can claim $300 without receipts. However, you must be able to produce receipts for all expenses after this point. So take advantage of tax time and keep a tight lid on your shoebox of receipts to ensure an efficient tax deduction strategy and to maximise your refund.
Avoid simple tax mistakes
The tax system is complex in nature and making a mistake can be detrimental to your hip pocket. The most common mistake is overlooking the amount earnt from your financial institution account. This is interest income and you must declare it when lodging your tax.
The ATO is currently focused on taxpayers claiming depreciation on rental properties. It is vital for individuals to understand the difference between repairs and additions to rental properties. What underlines a repair is the intent to restore the property to a condition it was previously in, without changing its character. Repairs are considered an expense and can be claimed against rental income, whereas additions take the form of capital. However, repairs that take place shortly after the property is acquired are considered to be costs associated with acquiring the property. They are therefore a capital expense and not a deduction.
Keep your employer informed
If you have a HECS/HELP debt and earn more than $55,874 from July 01, 2017, you must begin repaying the loan. This is the case even if you are still studying. Your employer can withhold additional amounts from your wage to cover the required repayments. Otherwise, you will need to pay back money as part of your tax return.
You can apply to have less tax taken from your wage if you have an investment property with a mortgage. Instead of collecting negative gearing benefits at tax time you’ll be able to enjoy a little extra throughout the year.
Instant $20,000 write-off
For small businesses, cash flow is a priority. Last year small businesses were able to purchase assets up to $20,000 and receive an immediate deduction for the full value. As opposed tohaving to write it down over the following years. From July 1 this year, the federal government is extending this benefit to businesses turning over up to $10 million. Get in quick to claim your tax savings because the policy is limited until June 30, 2018.
Use a registered tax agent
It’s important to keep-up-date with your tax. Filing an individual claim with a registered tax agent or accountant like ezytaxback.com will help prevent tax mistakes. We can also help you identify any missing tax deductions. You’ll also get expert advice and avoid potential penalties in the event of an audit. Our team of qualified accountants will also review your return and can provide you with a tax deduction strategy. We will show you how to get a high tax return and ensure you are not missing out on tax deductions.