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Tax Time – Future Gen Accounting

With some 14 million Australians looking to lodge early with many still working from home, this year you need to be especially careful.

We are preparing “Sharepoint” files for our clients to upload information for the completion of your personal and business returns. These will be emailed out to you.

This year the ATO have indicated they will be looking for unsubstantiated or higher than expected work related expense deductions and home deductions given many Australians are working from home. They will also be looking closely at claims for rental properties, especially given the unprecedented investment borrowing that has taken place.

Think about using our Tax Service this year

The service basically involves you uploading documents to a link to a sharepoint file that we create for you and that becomes the repository of all of your documents that you can access at any time. It means we can upload any additional documents to your file as they become available, making it easier for you and having your Tax Returns done seamlessly. This means quicker turnaround and refunds back to you faster.  If you would like to use our service please email here

Home expenses

In response to the working from home, the ATO has rolled out a temporary method that allows taxpayers to claim 80 cents for each hour they work from home doing the job they normally carry out in an office, and have incurred additional expenses.

In a big win for taxpayers, it means, unlike before the pandemic, you don’t need to have a dedicated area of your home like a home office set aside to get a deduction. However, if the temporary usage of the home is taking on some semi permanence and you are working from home on a continuing basis, then the old method of claiming a percentage of your home area will generally work better for you.

Protective clothing

This year is also set to see a pick-up in taxpayers claiming deductions for protective gear like face masks, gloves, gowns or sanitiser needed for work in customer- and client-facing roles.

Importantly, taxpayers in industries like healthcare, retail and hospitality can only claim these items if they paid for them and were not reimbursed.

 Other deductions to keep in mind

COVID-19 aside, there are many deductions that can be easy to overlook at tax time. For instance, if you use your mobile phone to make work calls, text messages or use the data for work purposes, then you can claim it as a deduction.

Internet expenses also can be claimed. If you work from home and have your internet connection in your name, then it’s possible you could also claim that expense. In this case, you can estimate your monthly internet use as a percentage of the total household usage.

Similarly, when it comes to using your car or travel, you can make a claim for work related travel and vehicle expenses provided they meet the eligibility criteria set out by the ATO.

Other common, but sometimes overlooked deductions, include union fees, donations of $2 or more to an appropriate charitable organisation and rental property expenses like gardening and lawn mowing, pest control and bookkeeping fees.

But remember, whatever deduction you’re seeking to claim, you will need to have a record to support it. Records, usually receipts, must be kept these for five years from when you lodge your tax return in case the ATO asks you to substantiate your claims.

Speak to one of our financial adviser