5 Things You Need to Know About Tax Returns
What is tax time for you? Is it a time to worry about paying crazy tax bills or a time to look forward to a hefty tax refund? Do you cross your fingers and hope that your deductions will eliminate your tax bill? Or, do you ignore your tax obligations all together and hope they just fade away?
No matter how you go about it, you need to know at least a thing or two about tax returns, even if you plan not to lodge one.
At Grow Advisory Group, we specialise in tax returns on the Gold Coast and can provide you with all the necessary information needed to make sound decisions on your taxes. Continue reading to be better enlightened.
What is the Tax-Free Threshold?
Australia has a tax-free threshold whereby tax is exempt for those who earn less than $18,200 in the last financial year, and no tax was withheld from that income.
This untaxed amount is for personal income or earnings, including bank savings interest and investment income. So, given that a tax-free threshold exists, the obvious question is, do you need to lodge a tax return if your income is lower than the tax-free threshold? Continue reading below.
Do I need to lodge a Tax Return?
This is the question that everyone wants to know. Unless your income falls below the tax-free threshold of $18,200, you will need to lodge a tax return. However, an NLA (Non-Lodgment Advice) form needs to be lodged. This form tells the ATO you won’t be lodging a tax return and ensures they don’t mark you as having an outstanding tax return.
Even if your income is less than the tax-free threshold, you may still need to lodge a tax return. But only if you paid tax on your income. A tax return is required so you can get back the taxes you paid.
If you are still unsure, contact Grow Advisory Group or take 5 minutes to complete this handy online assessment from the ATO.
When Do I Lodge My Tax Return?
You have from July 1 to October 31 to lodge your 2023 tax return. So, time is running out if you haven’t lodged it already. You can lodge your own tax return online with myTax through myGov, or you can entrust Grow Advisory Group with your tax return lodgement.
By appointing a registered tax agent to lodge your tax return, the tax return deadline extends to May 15 2024. However, you have to contact us ASAP to arrange this (before the October 31 deadline).
What Income Do I Have to Declare?
Withholding taxable income can lead to significant penalties.
The following types of income must be declared:
- Employment income
- Investment income
- Trust income
- Business income
- Partnership income
- Government payments
- Superannuation pension payments
- life insurance annuities
Some incomes are exempt from the declaration. Such income includes some Government pensions, allowances and payments, educational payments such as student allowances, scholarships and grants, some insurance payouts, and hobby income.
You can find out what these income exemptions here, and you can find out what distinguishes a hobby from a business here.
What Deductions Can I Claim?
The question everyone should know the answer to is ‘what deductions can I claim’! The key to a triumphant tax return (i.e. maximising your tax refund) is to claim absolutely every deduction you are entitled.
It’s a long list that differs from industry to industry and business to business. So, I encourage you to read this article on the ATO website to ensure you have covered all bases.
Alternatively, call Grow Advisory Group. We have specialist tax accountants that are prolific in industry deductions and will ensure you get the biggest possible tax return!
Conclusion
Tax time isn’t something to worry about. Not if you are well informed and have lodged the right documentation. You may even reap substantial tax refunds. The key is understanding the basics to make the right tax decisions.
Start by knowing the tax-free threshold and whether or not you have to lodge a tax return. Know the deadline for lodgement and the extension deadline for tax agents, and most importantly, know what income and deductions to claim.
You don’t need to tax again to lodge a tax return, but doing so will best position you for maximum tax refunds.
If you won’t meet the October 31 deadline or want to get the best possible refund, contact the tax experts at Grow Advisory Group.
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Disclaimer: The information contained in this blog is general in nature and does not take into account your personal situation. You should consider whether the information is appropriate to your needs, and where appropriate, seek professional advice from an accountant and/or financial adviser.
