For many of us, this time of the year is synonymous with tax time. For many people, preparing and lodging a tax return can be stressful and time-consuming.
For those of you who do need to prepare a tax return, here are some tips for making it as hassle-free as possible:
Get all your documents together
It pays to be organised – there’s nothing worse than a last-minute search for all your documents and receipts. Have a folder where you can store all your papers and receipts for tax.
Some of the documents to have on file include:
- your income statement (previously called the ‘group certificate’)*
- records of any other income you received, such as rental income, interest and dividends
- records of the purchase or sale of shares or property
- your private health insurance details
- receipts for any donations you made during the year
- a list of any work-related expenses, including receipts for these expenses
* If your employer reports through Single Touch Payroll (STP) you may not receive a payment summary from them. In this instance, your income summary information will be available when you log in to myGov. Log in to myGov, select ‘Australian Taxation Office’ and then select from the top of the screen ‘Employment’ and then ‘Income statements’.
What will the ATO be focusing on this year?
According to the ATO, this year they will be focusing on work-from-home expenses and rental property claims. The ATO will also be chasing hidden income earned by gig economy workers.
Deductions which will be closely scrutinised will include work-from-home expenses, general work-related expenses and rental claims.
With the boom in cryptocurrency, crypto capital gains is another area that the ATO will focus on.
If you’ve been working from home this year
According to the Australian Bureau of Statistics, two in five people with a job (41%) worked from home at least once a week in February 2021, compared with 24% in March 2020. And with lockdowns announced in NSW and Victoria in July, this trend of working from home looks set to continue.
If you have been working from home, there are three ways to calculate your home office expenses for your tax return:
- Shortcut method – this is the easiest method and is an all-inclusive claim of 80¢ per hour. It covers all working from home expenses, such as phone, internet, heating and cooling, lighting and equipment. Those claiming do not need a dedicated work area but must keep a record of the number of hours worked from home using a diary or spreadsheet.
- Fixed Rate method – this is a rate of 52 cents an hour and is for anyone who has a dedicated workspace. It does not include phone, internet or computer consumables or the decline in value of technology equipment. For example, claims for internet usage should cover time spent on the office computer, not watching Netflix.
- Actual cost method – this method uses your expenses to calculate a deduction on costs for everything from cleaning to computers. It’s more complicated than the other two methods.
Claiming deductions – what to consider
When claiming any kind of deductions, here’s what you need to ask yourself when working out whether it’s an acceptable tax deduction:
- was the expense directly related to your work or income-generating activity?
- did you actually spend the money and were not reimbursed by your employer?
- do you have a copy of the expense you’re claiming (for example a receipt or bank statement)?
Lodge your tax return from $59
Filing a tax return can be a costly and time-consuming exercise.
Maritime Super members have access to discounted tax assistance through Guideway Financial Services, with prices starting from just $59.
To learn more, call Member Services on 1800 757 607.
The information on this page has been issued by Maritime Financial Services Pty Limited (MFS). It contains general information that doesn’t take into account your individual objectives, financial situation or needs. It’s important to consider how appropriate this general information is in relation to your situation before making an investment decision. We recommend that you seek financial advice before making any decisions regarding your super or investments. The information on this page is current at the time of publishing.