Getting your tax return ready
Monday, 10 July 2023
But the process of claiming can be somewhat of a lengthy task – especially if you have a lot to claim. Some simple preparation now will help a lot when it’s time to do your tax return. Read our tips below on how to help streamline the process.
What can you claim?
When you’re preparing your tax return, you’ll have an opportunity to claim some tax deductions. Generally, the more deductions you can claim, the bigger your tax return may be. Therefore, the first thing to do when preparing to lodge your tax return is to do some research on what you can claim. The most common claims include work expenses, motor vehicle and car expenses, donations, work from home expenses, and tools, equipment and other assets. Visit the ATO website for a full list of what you can claim and the guidelines around these.
Organise your receipts
Now that you know what you can claim, you need to prove that you actually spent the money in the first place. It’s time to gather up all the receipts (printed and digital – don’t forget to check your inbox!) you’ve been collecting throughout the year. Depending on your ‘filing system’, this could mean anything from emptying a shoebox to going on a treasure hunt through your bags, wallets and laptop cases. Once you’ve got everything in one spot, sort the expenses into categories. For example, you might have one pile for vehicle/travel expenses, one for home office expenses, and one for tools and equipment. Then start entering your potential deductions into a spreadsheet. Have one column for the item name/description, one for the date, one for the amount, and one for the expense category. This will help make things a lot easier when the time comes to file your tax return.
Consider a tax agent
If you haven’t already, consider using the services of a tax agent, especially if you have a lot you want to claim. An agent will ensure that your return remains compliant with the latest tax laws and can help you understand how your income is calculated, which is great if you have various types of employment. And because they know all the categories to claim, they might be able to find one that you didn’t realise you were eligible for. While a tax agent does claim for their time, these fees are 100 per cent deductable – so you’re ultimately getting a great deal of help and saving yourself time, for very little expense.
Consider what you would use your return for
While we don’t advise that you spend your money before it hits your account, it is worth putting some thought into what you intend to do with it. Is the money going straight into savings? Perhaps you have some debt to pay down. Could it go towards your home deposit? Although it may not seem like a huge amount, using your tax return as part of your deposit could mean that you are able to purchase your own home sooner – especially with HomeStart’s low deposit loans (*ahem* 2% deposit plus upfront costs and NO LMI). Rather than quickly spending your return on items, having a larger goal and contributing towards that could make a huge difference to your long-term finances.
If you think that you are ready to begin the home buying journey or make a fresh start, or and take the first step towards getting into your own home, sooner.