With tax time nearly upon us, you might be interested in our following deduction tips, which could help increase the amount of money you get back in your Tax Return.
Lots of things can affect your tax return, including sources of income from work, investments and government assistance, including any JobSeeker payments you may have received during the financial year.
Other factors that can play a part, include whether you have work-related expenses, such as equipment, clothing or what you might’ve forked out if you’ve been working from home.
Here’s a quick rundown of things you could consider when preparing, lodging and hopefully maximising your tax return for the financial year ending 30 June 2021.
Tip #1: Working from home?
If you work from home, you can claim 52c per hour plus a pro-rata of expenses like electricity, internet, phone etc (items used during work hours). Or, you can use the 80c per hour with no additional claims.
If you can calculate the comparison, you might be better of using the 52c method + additional claims. If you're self employed, you can claim a portion of your rent or mortgage for the home office.
For details, check out the ATO’s home office expenses page, as further research may be required if you’re considering an existing method.
Tip #2: Keep your records
You need to keep all receipts. Your bank statement alone will not cut it. Anything you claim must be used as part of your work.
Take the time now to set up your systems for this time next year! Ask us about a scanning app, spreadsheet, or dropbox. We can help find you a solution.
Tip #3: It's Fashion
Did you know you can claim your handbag! (If it's used for work).
The ATO Website says:
You may be able to claim a deduction for a handbag, briefcase or satchel you buy to carry items for your work, such as laptops, tablets, work papers or diaries. The amount of the deduction will depend on how much you use the bag for work purposes.
For more information on deductible items related to your specific industry, see the ATO’s occupation and industry specific deduction guides.
Tip #4: Crypto-confusion?
The ATO does not view Crypto as money or currency, it classifies it as ‘property’ and therefore a CGT asset for tax purposes. Each digital wallet will be regarded as it’s own asset and loses on one will be offset against a gain.
If you sold any crypto currency and made a profit this year, the gain will be added to your taxable income (as a Capital Gain).
If you have held it for over 12 months, the same rules apply as any other growth asset with the Capital Gains Tax (CGT) discount.
i.e. only taxed 50% of the gain.
Tip #5: Superannuation
If you make any personal contributions to your superannuation, you can claim this on your personal tax return. You must ensure it's under the concessional contribution cap of $25,000 which includes your 9.5% employer contribution.
You also need to send a "notice of intent to claim" to your super fund. Make sure you do not leave it to the last minute as the money needs to be in your account before 30 June. If you are self-employed please speak with one of our financial advisors.
Tip #6: We're here to help
It's okay to pay for an Accountant to help you. There is so much we can do to ensure you get the best possible return. Our fee can also be claimed on your tax return!
Don't be afraid to get some help at this time of year.
If your finances are more complex, using a tax agent may provide you with peace of mind, as it could save you time, highlight deductions you didn’t know about, while making sure all your claims are legitimate.
For detailed information that applies to your situation specifically, please call our team on 1300 001 132 for help or contact us via our website.