5 Simple Tips to Help You Minimise Your Tax Returns
Our financial year ends on 30 June, and for some people, it’s straightforward. But for others it can be a little more complicated, especially if you are doing your numbers for the first time.
The average number of Australians during the 2010 – 2011 financial year, who lodged their tax returns online with the ATO (Australian Taxation Office) were 5.3 million people.
Many people search for legal tips to maximise their tax returns, while others look to reduce tax liability legally. Even if you want to pay your tax in full, there are legal steps that can help you save money.
Here is how you can do it.
1) Claim Work-From-Home Expenses
You can claim a deduction for expenses that you incur while working from home. Generally, you can claim either the ‘actual’ or ‘reasonable’ amount of the expense.
In ‘actual’ claim, you can deduct expenses that actually have occurred. These expenses may be work related, such as phone calls and internet. You can also claim for cleaning expenses – for example, cleaning products, vacuum cleaner and laundry detergent.
On the other hand, in ‘Reasonable’ claims, you may not have spent the money on a particular item, but if the cost is in line with market conditions, you can claim the actual amount that you have spent.
To claim work related expenses, you need to keep receipts and other records of your expenses. The ATO will typically send you a Notice of Assessment at the end of the financial year.
2) Claim Other Work-Related Expenses
Working from home isn’t the only way to claim work-related expenses. Here are some other deductions you can claim:
If you bought a computer for work, you can claim for depreciation. If you are on an hourly wage and you use an electronic diary to clock your hours, you can claim for the diary. If you travel for work, you can claim your travel expenses. If you bought a uniform, you can claim for those.
Keep all receipts. If you are not sure whether your claim is tax deductible or not, you can search the ATO’s website or contact them to settle your doubt.
3) Reclaim Your Donations
You can claim tax deductions for donations, up to certain limits. If you have donated to charity or religious organisations, or if you have made donations under the tax-deductible gift recipient scheme, you can claim tax deductions. You will be able to claim a deduction if you have paid for someone else’s travel, accommodation and meals.
The basic rule is that you can claim a tax deduction for donations to charities, approved organisations and religious institutions that are registered with the Australian Charities and Not-for-profits Commission (ACNC).
To claim a tax refund, you can log onto the website of the ACNC and search the list of registered charities and organisations. You can also ring up the ACNC to check whether an organisation is registered.
4) Claim Your Extra Refund from Working Side Jobs
Extra earnings from side jobs are usually not enough to be included in your Tax Return. However, this does not mean that the tax office will not ask you to update your tax return.
To have your extra income in the tax return, you need to be in the same occupation. For example, if you are a web designer and you have worked as a tutor, then you can add the income from the tutor job to your web designing job.
Conclusion
In order to minimise your tax liabilities, you need to ensure that you are deducting all the right amounts. But be careful not to claim for something that you are not cetain about.
If you’re not sure what to claim, get a professional opinion on your financial health. SMB Accounting has some of the best accountants in Sunshine Coast, QLD. Get in touch with us today to learn more.