With less than three weeks until the end of financial year, it’s time to start thinking about your tax return. If done right, it can help minimise your taxable income and also give you a sizeable lump sum payment.
Gather all receipts
Receipts are vital to provide evidence of purchases you are claiming. You are able to keep a soft or hard copy of the receipts, which may come in handy if you have trouble keeping track of all the tiny pieces of paper.
Don’t disregard small expenses – claim everything
If you find that most of your expenses are small, don’t assume they won’t help. Whether you have expenses of $5 or $500, they can add up and help maximise your refund. There is a long list of deductions that you can claim for work-related expenses. Some of these include:
• Vehicle and travel
• Clothing and laundry
• Home office
• Tools, equipment and other assets
• Gifts and donations
To read more about what you can claim on your tax return, take a look at the ATO website.
Donating money to your favourite charity before June 30 will not only be generous and philanthropic, but you can also claim the donation as a deduction.
Repairs and maintenance in investment property
If you have a number of repairs or maintenance issues you need to fix on your investment property, now is the time to do it. Any of these types of jobs that have been carried out throughout the financial year can be included when calculating your tax deduction. If you wait until after June 30, it will be another 12 months until you can claim these expenses.
Take out health insurance
The Medicare Surcharge is an additional tax that is chargeable for taxpayers who earn above the threshold and do not have private hospital cover. In order to avoid this surcharge, you can take out private hospital cover with an excess of $500 or less for singles or $1,000 or less for couples/families. Read more about the Medicare Levy Surcharge here.
Seek professional advice
Tax accountants have in-depth knowledge about the latest tax laws and changes. Whether you lodge your own tax return every year or are not quite sure where to start, a tax agent or accountant can help you save a lot of time and could also help improve your tax refund amount.
Start the new financial year running
If there are certain things you didn’t do this financial year which will limit how much you claim (e.g. not keeping receipts), make a plan to do so during the next 12 months. Learn from any financial mistakes you’ve made in the past year – this time next year you’ll be thankful that you did.