Your End of Financial Year Checklist – Navigating Tax Time Like a Boss
Another financial year is rapidly drawing to a close, which of course means tax time is around the corner. Avoidance has never proven to be a useful strategy to get your tax return in on time so it’s highly advisable to be on the front foot right from the start. To make the process potentially less painful, we’ve compiled a checklist of what you may need in order to maximize this years’ return.
Your income is not necessarily derived solely from your employer. Consider if any of the following may be applicable:
- Lump sum/termination payments
- Bank interest
- Employee share schemes
- Managed Funds income
- Rental property income
- Foreign income
- Capital gains
- Crytocurrency gains.
Quite often a minefield to navigate, deductions usually include expenses that have been incurred and not reimbursed which may impact your tax burden such as:
- Work-related deductions
- Home office expenses
- Self-education and professional development
- Registrations, subscriptions, memberships
- Vehicle and travel expenses
- Protective clothing, laundry and dry-cleaning expenses
- Tools and equipment, including depreciable assets (such as laptops)
- Accountant or tax agent fees
- Personal super contributions
- Investment income expenses, such as margin loans and financial adviser fees
- Income protection insurance premiums
Items to help Maximise Your Return
There are many ways to help you manage your tax effectively. Some key things to consider are:
- Personal super contributions may be claimed as a tax deduction up to the contributions cap limit.
- Low- or middle-income earners making a personal super contribution may receive a government contribution up to $500.
- A tax rebate up to $540 may be available for after-tax contributions to super on behalf of a low-income spouse.
- Contributions must be in your super accounts prior to June 30, or they will be assigned to the next year’s limits.
Private Health Insurance Rebate
If you have private health insurance, you are likely to be eligible for the private health insurance rebate which the government contributes towards the cost of your premium. Ensure you have the required information through from your insurer.
Investment Property Expenses
- Your property manager will provide and annual tax statement and ensure you also have information regarding any expenses you have personally paid including strata fees, land tax insurance or mortgage interest.
- If you have bought or sold properties ensure your have copies of the sales contract, settlement statements and related purchase or sale costs.
- A depreciation schedule, which shows the depreciation of the building and items within, may also be useful in delivering savings.
Home Office Expenses
If you have been working remotely, the ATO has introduced a flat rate claim of 80c per hour for all expenses. Those which may be considered include:
- Phone and internet
- Heating, cooling and lighting the workspace.
- Printing and stationery
- Equipment including furniture, computers and printers.
As with most deductions, its imperative to note that:
- You must have spent the money
- The expense must be directly related to earning an income
- You must have recorded proof
Of course, there is no substitute for expert advise when it comes to your tax so speak to your accountant to find out how best to maximise your return at tax time. Let the Blackburne Mortgage Broking team if you need any guidance this End of Financial year.