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Make the most of tax time

Make the most of tax time

Author: Paul Clitheroe

Are you across all the work-related expenses you could be claiming?

Tax time gives us an opportunity to claim back some of the money we spend as part of our job, and there’s a whole range of work-related costs that can be claimed on tax.

The Australian Tax Office website (ATO) offers plenty of information about tax deductible work expenses for a variety of occupations. A common thread is that you’ll need to have receipts if your work-related costs total more than $300, and you can’t claim a cost that’s already been reimbursed by the boss.

Some perfectly legitimate work-related expenses can come as a surprise. For instance, if you use your smart phone, tablet or laptop computer as part of your job, you may be able to claim part of the cost in this year’s tax return. Stick to the rules though. You need to keep a diary for four weeks showing how much of the cost of electronic equipment relates to work versus private use.

These days plenty of us spend at least part of our week working from home. If that sounds like you, it’s possible to claim a tax break for home office expenses – like a portion of your phone or internet bills, or depreciation of home office equipment like a desk or chair. Jump on the ATO website and take a look at the online home office expenses calculator. It makes it easy to see what you can claim.

Don’t overlook the other side of the ledger – your taxable income. This includes money earned on investments. Dividends from shares, interest earned on savings accounts, and any profits you’ve made on the sale of an investment property or shares – it’s all got to go in your tax return.

The ATO uses electronic data matching to check the income you’ve earned over the past financial year, and penalty charges can apply if you overlook anything. So it’s quicker – and cheaper, to get things right the first time.

If you’re in a hurry for a tax refund, using the ATO’s online myTax service can fast-track the process. myTax prefills some details like interest earned on savings accounts, which means less scrambling through paperwork. myTax can only be accessed through the myGov portal so you’ll need to register with myGov first to use the service.

If your tax affairs are more complex it’s worth using a registered tax agent. The fees for preparing your tax return can be claimed as a deduction next financial year, and as an added sweetener, using a tax agent can extend the time to lodge your tax return beyond the normal 31 October deadline. The extra time can provide valuable breathing space if you owe money on tax.

If you need any assistance with tax and the matters mentioned above,  please call our office.

 

Paul Clitheroe is a founding director of financial planning firm ipac, Chairman of the Australian Government Financial Literacy Board and chief commentator for Money Magazine.

General Advice Disclosure: This document contains information that is general in nature. It does not take into account the objectives, financial situation or needs of any particular person.

You need to consider your financial situation and needs before making any decisions based on this information. If you decide to purchase or vary a financial product, your financial adviser, AMP Financial Planning and other companies within the AMP Group may receive fees and other benefits. The fees will be a dollar amount and/or a percentage of either the premium you pay or the value of your investment. Please contact us if you want more information.

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