Top 20 questions about your 2016 tax return
Information verified correct on October 27th, 2016
How to get the most out of this year’s tax return.
At the end of the financial year, most Australians have their tax return on their mind. If you want to know how to get more tax back this year, you can use this comprehensive guide for all of the insights, tips and tricks you’ll need.
From how to choose a tax agent and lodge a tax return to claiming work and rental property costs, this guide covers everything you need to know to maximise your tax return in 2016.
20 tips to help you lodge your Australian tax return in 2016
What to know before you lodge your tax return
When is the tax lodge deadline this year?
The tax deadline is 31 October. This is the lodgment due date for the financial year ending 30 June, and gives you 4 months to submit your tax returns if you’re doing it yourself. Tax agents have their own deadlines so it would be a good idea to check with them about when you have to provide information to them. Usually you will still have to submit all your relevant details with a tax agent by the 31 October due date.
I’ve never lodged a tax return
If the 2015-16 financial year is the first time you’ve needed to lodge a tax return, you can do so online by using the Australian Taxation Office’s MyTax service, or by paying a registered accountant to lodge a return on your behalf.
If you think you should have lodged tax returns for previous financial years, you will also need to submit them. You can do this by contacting the ATO on 13 28 61, providing your Tax File Number and asking them which years you have tax returns outstanding. Alternatively, you can contact an accountant or registered tax agent and ask them to check your lodgment status. After that, you will need to submit your tax returns for all outstanding years, either through the MyTax portal or through an accountant.
Do I need receipts for work-related expense claims?
This depends on your job and the type of claim you make. In general, Australians can claim undocumented expenses of up to $300, but you would still need to provide evidence of the purchases if requested. The ATO advises that you keep all relevant records for five years from the time your tax return is lodged, in case you’re asked to provide them. For specific expenses and inquiries, you should refer to the ATO website, phone line or speak to an accountant to make sure you keep the right kinds of records.
Where can I find out more about what to claim?
The ATO is the official source of all tax-related information. It’s website provides free, detailed guides explaining what you can and can’t claim. Accountants will also be able to advise you on specific tax deductions you are eligible for when you lodge your return with them. There is also a wide range of guides available online through various publications and services, but be aware that most of this information is general and may not always apply to you.
What is an assessment sequence number? And where can I find it?
The assessment sequence number is a reference number for your tax return that’s printed at the top of your notice of assessment. The notice of assessment is an itemised statement that shows your taxable income and how much tax you’ve paid over the year. It also shows any likely refunds or payments to the ATO. The notice of assessment and the assessment sequence number are provided once your tax return is lodged.
What to know when lodging your tax return
I frequently donate money to charities. Can I claim these with the tax office?
Yes, you can claim a tax deduction equal to your donation amount for eligible donations above $2. The important thing to note is that your choice of charity must be a “deductible gift recipient” (DGR), and your “gift” must truly be a gift, i.e. you shouldn’t get anything in return for it. You can’t claim back the cost of those girl scout cookies, student raffle tickets or that gala fundraising dinner.
What is e-tax pre-fill?
The ATO’s e-tax online service gives you the option to “pre-populate your online tax lodgement form” with data available to the ATO, such as your Pay As You Go (PAYG) payment summaries (previously known as “group certificates”). This option saves you time because all you need to do is review the form and fill out any missing details. Note that as of 1 July 2016, e-tax is being replaced with MyTax, but still includes a pre-fill option.
What do I have to do if I fall into the group of targeted professionals?
In the past, the tax office has yearly targeted specific occupations or industries to make sure the lodgments made are accurate and legitimate. As of 2015, the ATO has taken a broader approach so that anyone can be scrutinised for the claims they make. For instance, in 2016, the ATO will be examining work-related expense claims for overnight travel, motor vehicle expenses for commute between home and work, and claims related to computers, phones and other electronic devices. Every lodged return will be compared to claims made by others in the same occupation and income bracket, and outliers will be queried. The rule is to keep your claims legit, and to keep those receipts in case they’re summoned.
Can I claim my rental property costs?
Yes you can, but only for the period your property was rented or available for rent. To find out exactly what you can claim, visit the rental section of the ATO website
Are there any capital gains tax for sold properties?
You can make a capital gain or loss on property sold, depending on whether your capital proceeds covered the cost base of that property. You should always declare any gains or losses you make on property previously or currently owned. The ATO will then calculate how much you have to pay, if at all. Capital losses can be used to offset capital gains.
Is bank account interest taxable?
Yes it is. You should receive a statement from your bank showing how much interest you earned in the financial year. Alternatively, you may be able to find your interest earning details by logging in to your Internet banking account and checking your account details or statements there.
How does a same-sex relationship get taxed?
As of 1 July 2009, same-sex couples have been treated in the same way as any other couple for income tax and superannuation purposes. This means if you and your partner live together “on a genuine domestic basis in a relationship as a couple”, your partner’s income and superannuation details will need to be included on your tax return and could affect your refund or payment amount. Refer to the ATO website’s guide to “spouse details”
for more information on what relationship information you need to provide on your tax return.
How about the contribution to my first home saver account?
The First Home Saver Account (FHSA) scheme was abolished effective 1 July 2015. If you have an existing FHSA account, you have until 30 June 2017 to lodge your claim on any government contributions you might be eligible to claim. Consult the ATO website or your state government for more details.
How can I check whether my tax agent is legit, i.e. registered?
Can I receive free help with my tax return?
If your income is around $50,000 or less for the financial year, you might be eligible for the ATO’s Tax Help program, where a trained volunteer will help you complete your tax return. Call 13 28 61 to find out more. Otherwise, tax accountant fees are always deductible too.
Is there free help for businesses to lodge a tax return?
Australian business owners can get free tax support for help with managing their taxes. You can get free support over the phone by calling the ATO on 13 28 61.
How can I lodge a Family Tax Benefit claim?
You can claim a Family Tax Benefit (FTB) as either a fortnightly payment or as a lump sum at the end of each financial year. If you’re eligible for FTB payments, you can submit a claim online via the myGov website, or in person at a Centrelink office. Note that changes have been made to FTB that are effective as of 1 July 2016, including eligibility requirements. Key revisions include:
- FTB Part B. If you are a member of a couple and have a child (or children) of 13 years of age or older, you are no longer eligible for this benefit.
- Large family supplement. This supplement ended as of 1 July 2016.
- Payments while travelling. From 1 July 2016, you will only be able to receive FTB, childcare payments or the Double Orphan pension for a period of 6 weeks while temporarily overseas. Prior to this date, payments were available for up to 56 weeks.
Can I claim children school expenses under the Education Tax Refund?
The Education Tax Refund (ETR) was replaced by the Schoolkids Bonus as of 1 January 2013. If you receive Family Tax Benefit (FTB) Part A for a dependent child at school and meet the income test requirement, you would be eligible for claims under the Schoolkids Bonus. Note that the Schoolkids Bonus is also being phased out, with its last instalment in July 2016.
What to know after you’ve lodged your tax return
Can I amend mistakes made on my tax lodgement?
If you realise that you’ve made a mistake while lodging your tax return, you can lodge an amendment online via the myGov website, by form or through your accountant. You’ll get a tax refund if the amendment reduces your tax owed, but you’ll have to pay the outstanding amount if it increases your tax owed. You could also be liable to pay a penalty and interest, but the tax office may be lenient because of your voluntary disclosure.
How do I get my refund? And when will I get it?
You can choose to receive a cheque or direct credit to your nominated bank account. If you’re desperate for a fast refund, then lodging your return online via MyTax (formerly e-tax) is your best bet. Most tax refunds for online lodgments are issued within 12 business days, but paper returns can take up to 50 business days.
After reading these answers, you should now be able to do your return with peace of mind. Remember, help is only an “Ask a Question” post away.
How to choose a tax agent
Now that you know how to get the most out of your tax return, it’s time to compare and choose a tax agent.
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*As of 1 July 2016, etax is being replaced with MyTax
|Tax advice on personal returns, rental properties, capital gains, and more.||Entirely online, with functions like auto pre-fill and tax calculator that make things very easy.||etax offers multiple services Low income: $38.50, Classic: $55.90, Fast: $67.90, Business: $167.90|
|H&R Block||Services individuals as well as small, medium, and large businesses.||Specialises in service to clients over 60 years old.||The fees for assisted online tax returns begin at $70 for under 21s and full-time students under 25|
|Navado||Tax advice for individuals, companies, partnerships, super funds, trusts and charities.||Provides tax advice on a variety of client situations.||Prices start at $143 for individual tax returns|
|ITP||Provides advice to individuals, businesses, sole traders, partnerships and trusts.||Boasts having 240 offices nationwide, and a smartphone app that captures all your receipts for deductions.||Varies with complexity of return and calculated on a per-quote basis.|
|Taxback||Caters to backpackers, students, foreign workers and business owners.||Get an instant free tax refund estimation online, and also pay nothing until return is complete.||Non-resident: $87 + handling fee, Resident: 9% of refund (minimum $99) + handling fee Citizen: $99|
|Tax return 24/7||Deals with backpacker tax backs, individual and company tax returns.||Maximum refund guaranteed in an easy process—10 minutes over the phone.||Basic individual: $99 + fees for additional services. Businesses: $200-$1,200|