The majority of Australian residents are required to prepare and file a tax return once the financial year is complete. You can lodge your tax return online. Though there are other options open to you, lodging online is quick and easy. If you opt to file an online tax return, you complete a webform online to do so. Otherwise, you will need to speak to a registered tax agent to help or request a paper form to complete your taxes.
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Guide to Online Tax Returns
What Are Online Tax Returns?
The purpose of filing a tax return is to inform the Australian Tax Office (ATO) how much you earn and which deductions you are claiming. This information helps the ATO assess whether you owe them tax money or whether you are due a tax refund. The ATO will also check whether you are liable for the Medicare levy and whether you are eligible for tax offsets.
You are required to file a tax return if you had tax withheld from income, you earned a dollar or more in foreign income, you received investment income, you are leaving the country and took an academic support loan, or you pay/receive due to a child support assessment. You have until the 31 October deadline to file your tax return online.
Filing Your Return Online
You can file online with MyTax. You will need to create or log in to your MyGov account linked to the ATO. It takes approximately two weeks to process online tax filings. Completing an online tax return is simple. When you sign in, you will see that the majority of the information is filled in automatically. These fields are generally populated by late July and include information from health funds, employers, government agencies, and banks.
All you need to do is review the information to ensure it's accurate. You can also input any income that isn't listed and complete your deductions. All that's left to do at this point is submit to lodge your tax return online. MyTax will handle the rest for you, calculating your income tax, determining whether you owe or are owed, and if you are due a refund it will be paid directly into your bank account.
You will need your bank details, payment summaries from your employers and Centrelink, receipts and evidence for deductions, and if you have it, private health insurance information. If you are married or in a de facto relationship, you will require their income information as well.
Declaring Your Income
Though the majority of your income will be pre-filled, there are plenty of additional income streams you may need to add yourself. It's your responsibility to ensure your income declaration is accurate. Make sure your tax return includes employment income, investment income, super pensions, annuities, government payments, foreign income, insurance and compensation payments.
Claiming Your Deductions
A tax-deductible is an effective way to reduce your assessable or taxable income. You won't always receive the full cost back, but you are entitled to claim a variety of deductions. If you are claiming work-related expenses as a deduction, you need to ensure you spent your own money and did not receive reimbursement. You can claim expenses that are directly related to completing your job or earning your income. You will need a receipt or record to prove your deduction. If your expenses have personal and work purposes, you can claim for the work-related aspect.
If you drive as part of your job, you might be eligible to claim car and travel expenses as deductions. You cannot claim the standard cost of your normal commute.
You may be able to claim laundry, dry-cleaning and clothing expenses. If you have a unique and distinctive work uniform that feature's the logo of your employer, you can claim dry-cleaning expenses. Occupation-specific clothing that meets industry safety standards is also deductible, from chefs' whites to hi-vis PPE.
You may also be able to claim for union fees, income protection insurance, and the cost of paying a tax agent or financial advisor.
If you are studying in relation to your job, you may be able to claim self-education expenses as a deduction. This includes student union fees, internet, course fees, stationery, professional journals, textbooks, and home office expenses.
Additionally, you can claim for equipment or tools you purchase with your money and are not reimbursed for. If it is valued at over $300, you need to claim the cost back over several years as depreciation.
Investment & Working From Home Expenses
There are potentially deductibles available when it comes to investments and working from home.
When it comes to investments, you may be eligible to claim the interest charged on any loan amount you took to invest. You can also claim for property expenses, investments and fees you paid to receive investment advice.
Whether you work for an employer or you're a sole trader working from home comes with potential deductions. You can use the fixed-rate method or the cost method to calculate your work-from-home expenses. The ATO did introduce a temporary shortcut method in response to COVID, but it was only valid for the 20-21 financial year.
QuickBooks Taxes Can Help
All Australian tax returns are due by the end of October. However, if you use a tax agent, it is possible to secure an extension. If you know your return will be late, it's wise to enlist a tax agent to apply for an extension before you miss the deadline. However you choose to lodge your return, you hold the ultimate responsibility for the figures and information you submit to the ATO.
QuickBooks Taxes can save you hours on preparing your tax filing. Tax time doesn't need to be as stressful as it was in the financial years gone by. It's never been easier to lodge a tax return online than with the features that QuickBooks Tax offers. All of the information you need for your tax return is a click away, it's never been easier to strengthen your paper trail.
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