What Are Your Tax Return Tips?

DealWatcher27 on 23/07/2019 - 22:38
Last edited 24/07/2019 - 12:50

Hi all, I have learned a lot of good tips from you all about the best saving tips. Thanks for all the great ideas!

As Australians are now busy lodging our tax return, what are your best tax return tips? Below are mine

  1. Health insurance premiums increase every year on April 1, pay private health insurance premium in full before 1st of April to avoid paying the higher premium.

  2. Use the ATO's app myDeductions to record deductions and store photos of receipts and record car trips. At tax time you can send your deductions to your tax agent or upload them directly to myTax. Reduce the stress of finding all the receipts while lodging the tax return.

  3. If you prefer to lodge your own tax return. You can use online tax agent. Personally I like Etax because their website is easy to use. It has a very detailed step by step walkthrough and some good deduction tips to guide you along each step.

  4. Maximise motor vehicle deductions. If the annual travel claim does not exceed 5000 kilometres, you can claim a deduction for your vehicle expenses on the cents-per-kilometre basis. You do not need written evidence to show how many kilometres you have travelled, but the ATO and therefore your tax agent may ask you to show how you worked out your business kilometres. If your business travel exceeds 5000 kilometres, you must use the log book method to claim a deduction for your total car-running expenses.

  5. Salary sacrifice. Forego future gross salary in return for receiving exempt or concessionally taxed fringe benefits and/or making additional superannuation contributions under a valid salary sacrifice arrangement.

  6. Claim tax deduction for your superannuation contributions. Please note that you will need to lodge a notice of intent form with your superfund and after-tax super contributions that you claim a tax deduction on will not be eligible for a super co-contribution from the government.

  7. Prepay your income protection insurance premium. If you have income protection insurance, you could claim your premium as a tax deduction. If you choose to pre-pay your premiums for the next 12 months and that 12 month period ends before 30 June next year, you can bring forward a tax deduction from next year to the current year – potentially reducing your taxable income this year.

Please share your ideas

Financial

Comments

  • Tech5 on 24/07/2019 - 01:11

    Uhh you sure about the vehicle deduction? I am fairly certain you still need to produce a logbook/diary showing calculations if the ATO asks

    • tomsco on 24/07/2019 - 07:01

      You may need to provide written evidence (such as a diary).

      I’m sure this would be easy enough for most people to produce. Obviously if you’re just putting a random number with no thought to it, it may be harder to verify your travel.

      In saying that, I would be interested in knowing if anyone has ever been audited based on a cents per km claim.

      • nicolemcmilllon on 24/07/2019 - 08:55
        +1

        Seen plenty of audits for cents per km claims. They will usually want written evidence from your employer that you are required to use your car for work related purposes (not from home to work)

    • brad1-8tsi on 24/07/2019 - 08:59

      Under 5k no logbook required. You just have to give an indicator of how you came to that figure.

      I've been claiming between 4000-4900km per year for the past 10 years. The first 5 years I kept a log but as it was consistently around 4500km I just claim a random number somewhere around that as I'm still at the same workplace and still travelling. If they ask I'll just dredge through my work calendar and do some calcs using google maps.

      ATO: You may need to provide written evidence to show how you worked out your business kilometres (for example, by producing diary records of work-related trips).

  • Ozbargainite on 24/07/2019 - 01:13

    Base yourself in the Cayman Islands, like The Guardian.

  • Donaldhump on 24/07/2019 - 05:53
    +3

    Do cashies, no tax paid

    • nicolemcmilllon on 24/07/2019 - 08:56
      +1

      Why would the person paying you want to pay you cash? They effectively lose their ability to claim the deduction for those payments.

      Now if they're getting the money in cash and not declaring it, thats a diff story lol

      • dasher86 on 24/07/2019 - 11:37

        Sometimes a payment for consumer goods or services is not tax deductible.

      • Donaldhump on 24/07/2019 - 17:38

        What the person buys is not taxable purchase, done charge gst, everyone wins, Australian tradies froth at the chance of cashies

        I don’t endorse this nor do it

  • CyberMurning on 24/07/2019 - 08:07
    +1

    What Are You, Tax Return Tips?

    No I am not tax, I am chimot

    • DealWatcher27 on 24/07/2019 - 12:51

      oh my… didn't notice. Thanks for pointing out!

  • orangetrain on 24/07/2019 - 08:37
    +1

    Create company in Cayman islands. Get hired by it. Employers pay the company and you. Retire to Cayman islands.

  • JIMB0 on 24/07/2019 - 08:43
    +2

    Pay less tax by earning less money.

  • altomic on 24/07/2019 - 08:47

    i always -over claim expenses, understate income, and staple $20 to the form.

    always sweet.

  • nicolemcmilllon on 24/07/2019 - 08:58
    +5

    My biggest tax tip would be, don't incur an expense purely for the sake of deductions.

    I constantly hear "But its a tax deduction so why not".

    Keep in mind that the deduction (if able to be claimed in full) will give you a net benefit of your tax rate. Most people's tax rate is about 34.5%.

    • DealWatcher27 on 24/07/2019 - 16:00

      This is a good point. thanks!

  • SBOB on 24/07/2019 - 21:33

    Maximise motor vehicle deductions. If the annual travel claim does not exceed 5000 kilometres, you can claim a deduction for your vehicle expenses on the cents-per-kilometre basis

    also, this is 'per vehicle'
    so for some, who might have more than 1 vehicle, theres ways to claim > 5000km if you happen to use multiple vehicles

  • sub102 on 31/10/2020 - 02:25

    Is Etax free? Or any other others like HR block are

    • DealWatcher27 on 01/11/2020 - 22:50

      They charge before you submit the tax via their platform.

      • sub102 on 01/11/2020 - 22:53

        So if you want to do it free best way is to do via myGov you think?

        • DealWatcher27 on 01/11/2020 - 23:24
          +1

          Yes, you are right. However, Etax organises the information very well. Easy to use for those who wish to submit their own tax return. You can use Etax to work out the details then copy the data manually over to myGov for submission to avoid the fee.

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