Top tips for your income tax return

In order to get the most from your income tax return, you first need to comb through your expenses.

Every year, Australians look forward to getting their tax refund. However, many people don't realise that there are ways to maximise their entitlement, and in some cases, aren't actually receiving what they're owed. This year, don't come up short – here are our top tips to get the most out of your tax return.

What is an income tax return?

Anyone who earns income generally pays a form of tax. This is a fee we pay to governments, and is used to maintain infrastructure such as roads, as well as funding public education, healthcare and defence. In most cases, an employer will take tax out of wages and pay it on behalf of their employees. 

A tax return, or refund, is paid after lodging an annual return, telling the Australian Taxation Office how much you earned in a year, and the tax paid. After investigating your claim, a refund will be paid out if you're entitled. 

TaxCombing through your receipts with an accountant may uncover expenses you can claim tax for.

How can I get the most out of my tax return?

When filing your income tax return, it's important to be vigilant in providing as much information as you can in order to maximise your refund.

Identify your deductions

The most effective way of getting a more substantial tax refund is by claiming deductions. These are work-related expenses that your employer hasn't reimbursed you for. These may include:

  • Home office expenses, including internet and phone bills.
  • Work related travel.
  • Equipment for work, such as laptops.

It's always helpful to discuss deductions with the help of a trusted accountant. There may be things you're paying for that you haven't considered as deductible expenses – an accountant can advise you on these. Not only can they help in getting your ducks in a row, they can also trawl through relevant receipts and expense sheets for you.

Contribute to your superannuation

In relationships where one person isn't working, such as a stay-at-home parent, or is earning less than AU $40,000 per annum, contributing to the other person's superannuation fund can reduce the amount of tax paid.

The person earning the higher income – over $40,000 – is allowed to deposit up to AU $3,000 into their partner's superannuation fund. In these instances, a tax offset can be claimed of around 18 per cent. 

DonateCharitable donations you make throughout the year often have tax you can claim as a refund.

Make charitable donations

Making charitable donations throughout a year means that you may be able to claim tax on them. In order to claim a return from donations, you need to make sure that they fit the following criteria:

  • That the organisation donated to has Deductible Gift Recipient status.
  • You must have receipts for your donation.
  • Donations must be in the form of money, worth more than AU $2.

If you're unsure what you're eligible for as part of your tax return, or have any questions about the filing process, it's important to get in touch with your accountant to help you through the process.

For professional tax and audit services, get in touch with the team at WMC Accounting.

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