Filing your tax return at the end of each fiscal year is not a simple task for many taxpayers.
After a tumultuous 2020-21 fiscal year rocked by coronavirus chaos, this year’s comeback is unlikely to be any easier.
Watch the video above to see the top 10 tax tips you can claim on your return this year
There are many Australians whose employment status has changed – at least once, but probably several times – over the past 12 months.
There will be millions of people who have received government wage subsidies, such as JobKeeper or JobSeeker payments.
Houses have become offices.
Over $ 36 billion has been taken from retirement accounts.
It’s not hard to see how for many Australians those COVID-19 curved balls were thrown was already a difficult task to navigate.
7NEWS.com.au sat down with the Australian Tax Office to find answers to the most frequently asked questions about tax filing in 2021.
Tax declaration deadline
Usually the deadline for filing your return is October 31st.
As October 31 falls on a Sunday this year, you have until November 1 to find accommodation.
If you choose to use the services of a registered tax agent, they will usually have special filing schedules and can file client returns after October 31. If you are using a registered tax agent, you must hire them by October 31.
If you are having difficulty meeting your tax obligations or are unable to file by October 31, the ATO will notify you. contact as soon as possible.
If you file your own tax return and it results in a tax bill, payment is due by November 21, even if you file, whether you filed before or after the deadline.
Common tax errors
According to the ATO, most of the mistakes Australians make when filing tax returns are simple mistakes made by people filing early or not including all of their income.
A taxpayer’s labor income, bank interest, stock dividends, and health fund information are automatically included in myTax by the end of July, so people trying to file early are more likely to be forced to go back and modify their request.
With Australians making big purchases at the end of the fiscal year, sales hoping to claim the full amount were also flagged as big mistakes by the ATO.
“Deductions for items purchased for labor are to be spread over the days held during this fiscal year,” an ATO spokesperson told 7NEWS.com.au.
“Purchases over the $ 300 limit must also be amortized over a number of years (effective life). “
How will COVID-19 complicate tax filing?
Australians have long been wary of the complications the coronavirus pandemic continues to create, but will now need to be more attentive to its impacts when filing their tax returns in 2021.
The Australian Tax Office says it has made a number of changes regarding the preparation of tax returns in a COVID-19 environment.
The ATO has amended the income tax returns of Australians who:
- were on JobSeeker payments
- were on JobKeeper payments
- worked / worked from home
- accessed their retirement pension earlier
- received down payments
- changed jobs
Click here to see how these changes may affect you.
What does the ATO focus on when assessing tax returns in 2021?
The ATO has laid bare the targets for people submitting their 2021 tax returns.
A spokesperson told 7NEWS.com.au he was going to crack down:
- work-related expenses (including double deduction when claiming deductions and work-related expenses that are NOT work-related)
- rental properties
- capital gains on cryptocurrency, goods and stocks
For your convenience, we’ve put together a guide to explain them in more detail so you know what to keep an eye out for.
You can click here to see all of the ATO’s questions and tips to get you ready for your tax return.
How do I find my tax file number (TFN)?
A Tax File Number (TFN) is your personal reference number for the Australian tax and pension systems.
You are not assigned a single TFN, whether you change your job, home address or even your name, and it is an important part of your tax records.
You can find your TFN in different ways:
- if you have a myGov account which is related to the ATO, log in and navigate to ‘My profile‘then’personal details‘.
- view documents like last year’s notice of assessment, your most recent super statement, or the summary of payments provided by your employer.
- ask your registered tax agent if you are using one.
- for a business or organization, sign in to the Business Portal and see the TFN entity displayed in the screen header on most portal screens.
- if you still can’t find it, you can call the ATO on 13 28 61 from 8 a.m. to 8 p.m. on weekdays and from 10 a.m. to 4 p.m. on weekends.
Australia’s second largest labor tax rate
Second jobs usually have a higher amount of tax withheld from your pay because you already have another job from which you are earning income and claiming the tax exemption threshold.
Withholding at a higher rate reduces the likelihood that you will have a tax debt at the end of the income year.
When you start a job, your new employer will give you a TFN declaration to complete.
Centrelink is also a payer and they will give you this form if you request their payments.
When you complete this form, you can choose to claim the tax exemption threshold from your employer.
- still earn income from your first employer, even if it is done through the JobKeeper payment, you should not apply for the tax exemption threshold for your second job
- no longer receive income (including paid vacation), you have the right to claim the tax exemption threshold of your second job and to benefit from a lower withholding tax rate
- start receiving income from both employers, you can request that an employer withhold at a higher rate to avoid a tax debt at the end of the year
How to link your MyGov account to the ATO
To link your myGov account to ATO, go to your monGov account and select ATO from the list of services.
The quickest and easiest option is to select “Questions specific to you”. All you will need is your TFN and two basic facts like your superannuation enrollment and your bank account details. You can find a complete list here.
ATO recommends that you select the questions so that you can help yourself to self-service. Otherwise, you have to call.