Want to make the most out of your tax refund? Want to get the biggest refund possible?
Below are 3 Helpful Tips to maximise your tax refund and get the best results possible:
Tip 1: Claim as many work-related expenses as you can
No matter the occupation or profession you are in, there are many expenses that you can claim in your tax return. However, be careful and reasonable with what expenses that you claim, as you may get penalised from the Australian Taxation Office if you claim incorrectly. Most expenses that you can claim are more obvious than others, like an apprentice’s tools or travel expenses. When want to claim an expense make sure it is:
- Relevant to the industry you are working in. There’s no point in claiming power tools if you work as a school teacher. The ATO will notice this and immediately penalise you for incorrect claims.
- Have receipts if purchases exceed $1000. Having a receipt of purchase is better than having none, sometimes the ATO needs extra proof of purchase if things don’t quite add up.
- Claim as much as you can, if you can justify a purchase, claim the optimal amount possible. There’s no point claiming a couple of dollars if you believe over the year you have spent more.
So what can you claim, here are a few examples:
- Tools and work-specific clothing: The item purchased is needed to perform your job e.g. tools that tradesmen use, equipment that hairdressers use, special shoes such as steel cap boots for personal protection.
- Safety items: Items needed for self-protection or safety when doing your job e.g. sunscreen and sunglasses if you are required to work outside.
- Laptops and mobile phones: If these are used for work purposes you’re able to claim it on tax (if you have a laptop that you use for work and personal use, you’re only entitled to claim the portion that you use for work). This works on a percentage basis for your work-related uses of your total phone bill.
- Courses and conferences: Self-education expenses, such as courses and certificates, need to be directly related to your profession and will help you get a promotion or a pay rise.
Tip 2. Claim tax deductions for working at home
If you work from home full time, part-time or only on the odd occasion, you’re eligible to claim this as a tax deduction. For example, if you’re running a business from home (full-time or part-time) that requires you to use computers, phones, and other electronic devices, you could be eligible to claim deductions on certain costs. This even included the cost of your home internet and electricity bills!
Working from home tax deductions can include the following:
- Cleaning costs: The expenses incurred by cleaning office space at home.
- Office furniture: Purchase and repair costs for office furniture and fittings required to do your job.
- Your phone bill: Landline and mobile phone calls related to work matters (you should get an itemised phone bill and highlight the work-related calls)
- Your home internet bill: You can claim a portion of your monthly internet bill, in line with how often you use it for work purposes.
- Electricity bills: You can also claim a portion of your home electricity bills, in line with how often you work from home.
Tip 3. Use a Tax Agent (they’ll help maximise your return and their fee is tax-deductible!)
For a lot of people, using a tax agent to lodge your tax return is the easiest way to ensure you’re claiming everything that you’re eligible for. Here’s how tax agents can help you this tax time:
- Claim the tax agent fee as a tax deduction: You might be surprised to learn that the cost of using a tax agent is completely tax deductible on next year’s tax return.
- Claim more deductions: Tax agents know the ins and outs of the tax system so they’ll be able to help you claim everything you’re entitled to, even things you might not be aware that you’re entitled to claim.
- Claim correctly: If you don’t claim your deductions correctly, you could be hit with a fine from the ATO. Tax agents will help make sure you’ve claimed everything correctly so you can have peace of mind after you lodge your return.
- Help with calculations: Claiming things like home office expenses and car use can be really tricky and time-consuming. You’ll often need to create a logbook or show your working for figuring out how much you can claim. Tax agents are professionals at this, so it can save you a lot of time and stress.
- Offer tax tips: Tax agents can also offer you extra tax tips and tips for organising your finances in general.
Perth Tax People are the best to use when maximising your tax refund, want to know more or unsure what you can claim? Send us an email with your questions to firstname.lastname@example.org