The tax time is approaching, and every organization and working individual is looking forward to preparing to lodge an income tax return. Several things affect the income tax return like income from work, government assistance, investments, etc. Other aspects which also play a significant role are expenses, like equipment, travel, clothing, etc. Take a look at the quick guide, which will help you lodge a tax return.
- Who all need to prepare a tax return?
Some individuals or organizations are there who may not require lodging a tax return. It includes the ones with lower levels of earnings and also older Australian citizens. People who have to file a tax return need to cross a certain threshold only then pay taxes; however, if you are unsure in which category you lie, you should speak to the tax agents. Otherwise, you can check the online questionnaire available at the ATO’s website.
- Documents required lodging a tax return.
Before lodging a tax return, you must know the documents required. They are bank account details, tax file number, income statements, payment summaries, payment details through Centrelink, statements and receipts, private health insurance details, etc.
- Tax deductions to be claimed
Many tax deductions are related to work, but a work-related expense comes under deduction if the employer didn’t reimburse it. It is directly related to your income that you earn and other receipts. The work-related tax deductions include travel and vehicle expenses, occupation-specific requirements, like footwear, clothing, education costs, working from home expenses, equipment and tools, etc. Also, if your expenses are for personal and work usage, you are eligible to claim for a work-related portion only.
- Additional deductions
Other deductions include super personal contributions, last year’s tax return fee, dividend, interest and other investment-related expenses, donations and gifts, etc. Suppose you when on a conference on the company’s behalf, then the expenses will be included in additional deductions. But if you extend your trip just to spend some more days there, you will get only half of your expenses. So, before making deductions, it is better to understand every term and condition before you file for a tax return.
- Extra details when individual claim work from home deductions
The ATO has revealed that a shortcut method that can apply to calculate relevant tax deductions. It is for people who have been working from home for the financial year from the 1st of July 2020 to the 30th of June 2021. It means that you can claim 80 cents for every hour if you work from home covering all your eligible tax deductions. The shortcut is all-inclusive, and if you cannot claim this, you can go for individual expenses. It includes internet bundles, phone and can be counted under the arrangements which are existing. The fixed-rate method is another thing under which you can consider other deductions.
- Lodging your tax return through a tax agent or by yourself
You can lodge your tax return independently or by taking some guidance from individual tax return professionals. The ATO app and myGov website are available through which you can lodge. You can complete the paper tax return or speak with the registered tax agents. It can incur a fee, but you can also file the tax on time and claim for the necessary deductions.
- Lodging on your own
People whose earnings are simple or less can lodge a tax return by themselves, and it needs to be done by the 31st of October. For more information, you can visit the website of ATO.
- Hiring a registered tax agent
Of course, hiring a registered tax agent in Perth comes with some price. But before choosing, you must make sure to check if they are registered and qualified. Finances are complicated, and if you want to have peace of mind, you must check all claims are legitimate. It could save your time, and you can invest your time in other things instead of thinking about tax.
- Evidence required for the tax
While claiming for over $300 on work expenses, you have to give evidence for that. You must keep documents for at least five years from the time you have lodged a tax. Keep invoices, receipts, documents of item purchased, date of purchase, supplier name, document date, the value of the item, etc. The required documents also include payment summaries, financial institution statements, credit card and bank statements, deduction receipts, etc. Prepare a tax return checklist as it can help you keep all the things in place so you can claim the deductions.
- About tax-free threshold
Being an Australian resident, the first-year income of $18200 is tax-free, and it is known as the tax-free threshold. It can be used further to reduce the amount of tax that has been withheld during the year. When you step into a new job, you will receive a tax file number declaration from the employer, which you had to complete. If you are a sole trader or self-employed, you have to pay the income tax at the individual income rate. The tax-free threshold of $18,200 is equal to $700 a fortnight, $350 a week, or $1,517 a month. If your taxable income surpasses the threshold, you have to pay tax on your earned income. People with more than a job must ask for the tax-free threshold from their payer. It is the person who issues the highest wage or salary.
Final words
Well, these are all about what you have to do while filing a tax return. The tax agent in Perth is always there for your service. Just call them and book an appointment, and they will reach you at the earliest. Filing tax is a complicated thing, and you have to be careful while including all the requirements. Missing out on a single aspect can lead to the payment of fines. But if you hire an expert, you can reduce the tax amount and also eliminate fines. Thus, it’s time to look for professionals near you.
