With the end of the financial year fast approaching, individuals and businesses are once again faced with the task of completing their tax return – something many of us approach with a mixture of hope and dread.
To reduce hassle and ensure your tax return is maximised, it’s advisable to seek the assistance of an accountant – however, you need to choose wisely. Make sure that your accountant of choice is a registered tax agent. You can check online via the Tax and BAS Agent Register.
Financial planners can help you plan for tax throughout the year. Select a financial planner who is independent and fee-based, as this ensures they have your best interests at heart, as opposed to chasing commissions.
An experienced financial advisor can ensure you get the most out of your tax return this financial year.
Some common deductions to look out for are:
- Work-related claims – No documentation is needed for deductions up to $300. If you are claiming more than $300 in deductions, you need to have receipts and documentation.
- The cost of working from home – Those who are self-employed or work from home can often claim any costs associated with running a ‘home office’ – including internet, phone, electricity, and the depreciation of any equipment.
- Uniform expenses – Both compulsory and non-compulsory uniforms can be tax deductible, however the uniform needs to be clearly identifiable (e.g. logos), or considered specialist clothing (e.g. safety gear such as steel-capped boots). If your uniform is registered with Ausindustry, it’s automatically tax deductible.
- Write off any bad debts – If you’re owed money, you may be able to write off that debt and claim the amount written off as a deduction. While this is common, it is important to ensure you seek professional advice as it can be complicated.
- Tax offset for out-of-pocket medical costs – From 1st of July 2013, the net medical expenses threshold is being phased out. For the 2013/14 tax year, you’re able to claim out-of-pocket expenses above $2,120 ($5000 if your taxable income is greater than $84,000 for singles, or $168,000 for families) only if you claimed the offset for 2012/13. You can only claim this offset in 2014/15 if you claim it this year.
Get the most out of your tax return this year by seeking assistance from an independent, fee-based financial planner. Not only will they be able to assist you in claiming the right deductions, they’ll be able to provide you with advice for the next financial year – ensuring future tax returns are maximised.