When stores start spruiking end-of-financial-year sales, you know it’s time to start thinking about (legal) ways to boost your tax return! Some deductions are really easy to miss, so we’ve compiled our top tips for ensuring you get the maximum possible refund this tax time.
1. Give it away
While you’re gathering together receipts for expenses you’ve already laid out, it’s also the perfect time to donate to one of the many worthy causes in desperate need of funds to continue their critical work. Donations are fully tax-deductible, and you’ll make a huge difference to more than just your bottom line.
Action: Pick a cause and donate. Then go through your email and files, dig out your donations receipts & print for your tax return.
2. Gather your fee receipts
Bank fees charged on investment accounts or interest payments on funds borrowed to purchase investment assets are tax-deductible (remember to report the interest/dividends earned on these accounts as assessable income). Don’t forget that fees to your financial planner are also tax-deductible, provided the advice you received relates to income-producing assets. You can’t claim for the initial plan, but you can claim for ongoing advice relating to those assets.
Action: Print out a summary of all your various bank fees, charges and interest. Print the invoice for fees paid to your financial planner.
3. Claim your insurance costs
Income protection premiums are completely tax-deductable as long they’re not paid within your Superannuation, and can provide a great boost to your refund.
Action: Request a summary from your insurer that itemises your income protection from your other forms of life insurance.
4. Claim your tax return fees
The amount you pay to your accountant to prepare your tax return each year is fully deductible, as is the cost of travelling to see your tax agent to have your tax prepared. Make sure you keep a record of the number of km’s you travel and any other incidental costs such as parking, meals, accommodation (if applicable).
Action: Dig up last year’s tax receipt, and estimate how much it costs you all up to have your tax return prepared.
5. Don’t forget those small work-related expenses
You can claim a deduction for business expenses you have incurred that haven’t been paid by your employer. This includes money spent buying and repairing equipment and supplies you use at work, including tools, electronic organisers, stationery, diary, work bag, tool belt or briefcase and mobile phones. You can claim up to $300 for these small expenses without a receipt, provided you keep a record with information that would normally be shown on a receipt (date, business name, item purchased, price). Find out more about claimable work expenses.
Action: Print out all invoices, receipts and expenses and pop them in a manilla folder. Make a list of items you bought that you didn’t keep receipts for.
6. Check your Extras & threshold
Where do you sit with your private health insurance Extras and the Medicare threshold? You can get a statement of your out-of-pocket medical expenses from Medicare online or in person. If you’re close to a threshold, it might be worth thinking about having that procedure you’ve been delaying. Likewise, get some bang for your buck with your private health insurance… check where you’re at with your Extra’s and think about whether you can use them before they renew on July 1!
Action: Check your Extra’s limits and Medicare threshold and think about how you can maximise the benefits.
7. Think about pre-paying
You can save a bucket-load of tax by pre-paying the interest on your investment loan. Imagine how much you could save if you pre-paid 12-months worth of interest? If you think you’ll be earning less in the next financial year (for example if you’re taking maternity leave), also think about pre-paying your income protection premiums so you can claim the deduction in the year that it will make the most difference to your bottom line.
Action: Contact your bank or financial adviser to organise pre-payment of your interest, and speak to your insurer about prepaying your premiums.
8. Are you an avid reader?
Every book (or similar) that was purchased for the purpose of helping you make money or invest can be deducted from your tax.
Action: Start reading and get your receipts together!
9. Protect yourself.
With more than 600 million pieces of third-party data used to track activity and income, the ATO is relentless. Neither the best Accountant in the world, nor a 100% accurate lodgement, is any guarantee against an Audit. And the costs of being properly represented during an audit can add up pretty quickly, when even a simple enquiry can sometimes require hours of work. Audit Shield provides a cost-effective solution to guard against these unbudgeted costs if a current or retrospective tax audit is sprung on you.
Action: Find out more about our Audit Shield service and call us on 9887 8751 to get yourself covered.
10. Be prepared.
Use these Tax Tools to make sure you’re claiming every possible tax deduction you’re entitled to!
For tax advice and help lodging your tax return, simply email us or call us on 9887 8751 for an appointment. Don’t forget that the fees you pay to get your tax return done are tax-deductible!