Working from home.
The ATO announced a new way to make it easier for people who work from home. It is called the shortcut method and you can claim 80c per hour for each hour worked at home. You can use the shortcut method to calculate your working at home expenses for the period between: 1 March to 30 June 2020 in your 2019–20 tax return and/or 1 July to 30 June 2021 in your 2020–21 tax return.
Note under this new method you can’t claim items such as phone, internet, office supplies or furniture for your home as a separate deduction on your taxes. Whilst easier, this can result in a smaller tax refund. The ATO is recommending this “80 cents – shortcut method” method but it doesn’t work for all people.
A part-time or full-time student studying at university, college, school or another place of education maybe able to claim the cost of self-education in their tax returns. There must be a direct connection between the study and current work activities.
No claim is allowable where study is undertaken to get a new job, or to open up a new business or income-earning opportunity. Speak to a tax agent and/or accountant if you have any questions about including a self-education refund on your tax return.
Consider audit insurance.
ATO audit reviews are increasing for individuals, businesses and self-managed superannuation funds. Sophisticated data matching technology is enabling detailed cross-referencing from an assortment of government departments, which increased the frequency and scope of audits, reviews and investigations in recent years. Audit insurance can protect you from any additional costs that might be incurred should your accountant need to liaise with the ATO on your behalf in relation to an audit. It can be a small expense for considerable peace of mind.
Claim your tax-deductible rental property expenses.
If you get income from a rental property, then you can deduct any expenses related to owning and operating the property. There are lots of them but some aren’t a straightforward claim and it can easily become confusing if you don’t know the in’s and out’s of each claim criteria. Bank charges, cleaning, council rates, gardening, land tax, pest control, capital works, water charges, repairs, insurance, tax agent fees – they are all claimable! Join hundreds of our Penrith clients receiving top service every year in lodging their tax returns for rental properties.
Assess your tax offsets.
A tax offset is an amount of money that you can claim for tax purposes. The ATO will reduce the amount of income tax that you owe from your gross income by the value of the tax offset. Offsets are not rewards or rebates, but rather they are a reduction in the amount of tax that you owe. There are two main types of offsets: non-refundable and refundable. Non-refundable tax offsets are calculated before any other deductions whereas refundable tax offsets are calculated after other deductions.
An accountant might be able to offset some your tax if you are a Senior Australian or pensioner, receive specific government allowances or payments, have certain dependants, are a carer or low-income earner.