Many Australians lose hundreds of dollars each year simply because they forget work-related deductions or receipts for items they can claim back.
Do you compare your tax refund to your friends and family and wonder, “How can I get a better tax refund”?
Fortunately, there are lots of ways most Australians can improve their tax refund. Millions of dollars are left in the hands of the ATO every year, lost by taxpayers who simply didn’t make the most of their tax return.
Proper tracking and claiming of tax deductions is the biggest strategy for getting the best tax refund. Along the way—and this is serious—you should not add fictional or inflated claims to your tax return. The ATO has new technology that can find inaccuracies in your tax return, and they are better at this than you could even imagine. But that’s okay—we should all pay our share in Australia and we can still get nice, fat tax refunds by doing it right.
(Most Aussies use a tax agent like Etax to help get a better tax refund and avoid ATO audits, but the tips below are still very important.)
- Important updates:
Tax cuts announced in 2020 mean millions of Australians get a tax rebate that will boost their tax refund this year too. Does the tax rebate apply to you? Read more about tax cuts
- Etax is updated this year with automated deduction-finder tools that help you find the deductions you deserve. Your Etax return will automatically suggest deductions like the ones below, when they are most relevant for you.
How to get the best tax refund
Here are 10 of the most under-claimed (but legitimate) tax deductions:
1. Car expenses
Often forgotten, these costs quickly add up. Don’t leave them off your return. (Your journey to and from work cannot be claimed, unless you are required to transport bulky equipment that you cannot leave at work.) Here’s a reality-check: The ATO is concerned about excessive car expense claims. Do not get carried away with this. Be honest – if you drive for work, it’ll be a good tax deduction. Don’t risk an ATO audit by making silly car claims.
2. Home office running costs
If you need to do some of your work at home in a dedicated home office you can claim 52c per hour towards running costs, alternatively you can claim actual costs if you have established and recorded a pattern of use.
Read more about home office expenses here.
3. Travel expenses
Include the costs of any work related travel and/or accommodation. If you receive an allowance from your employer, you must include this amount as income on your tax return. Always keep good records, such as a travel diary, and all your receipts for your travel expenses.
If you wear a branded uniform for work you can claim up to $150 per year for laundry expenses without receipts.
5. Income Protection
If you pay for income protection insurance, outside of your Superannuation, you can claim the cost of the premium as a tax deduction.
6. Union or Membership Fees
If you’re a member of a union or a professional body you can claim those registration fees.
7. Accounting Fees
If you paid an tax agent to prepare your tax return last year, make sure you include the fee you paid as a deduction this year.
8. Books, periodicals and digital information
Educational and trade publications, print or digital, that are directly related to earning your income.
Depreciation on your computer when used for your work – your tax agent will help you work this out. Plus, the work related percentage of your home internet use and phone expenses can be claimed as tax deductions.
10. Tools and equipment, including protective items
If you purchase and repair items that are a requirement of your job, such as non slip nurses shoes, overalls, measuring devices, stationery etc. you can claim these as tax deductions.
Keep a diary for anything work related. This is very helpful for home office, laundry, supplies and tools. Your diary helps you to both calculate and prove the work related amounts on your tax return. Your diary can be a simple list with a description, date and amount for each item – plus keep the receipts.
Increase Your Tax Refund with Simple Record Keeping
If you want to get the best tax refund every year, some good but simple record keeping is the trick. Keep every receipt for every payment you make on work expenses – even if you’re not sure if you can claim them.
Here’s a guide on easy tax record keeping “for normal people”.
ATO tax rules change every year. Getting the best tax refund and avoiding ATO trouble isn’t easy on your own.
At Etax.com.au, as your Tax Agent, it’s our job to help you claim the maximum possible deductions to get the best refund that you’re entitled to. It’s no wonder that over 74% of tax payers use a registered tax agent such as Etax.com.au to prepare their tax return.
If you’re ready to start your tax return, simply click here and you could finish in a few minutes!
Can you think of another deduction for this list? Leave us a comment over on our Facebook wall.