Tax Tips

·         Working From Home & Tax – With working from home becoming more common, it allows taxpayers the chance to claim a deduction for their home office expenses.   Taxpayers can claim a deduction for additional running expenses incurred when working from home at a fixed rate of 52 cents for each hour worked from home. The rate covers the additional running expenses you incur for various expenses such as electricity and cost of repairs to your home office equipment, furniture and furnishings.  To use this method, you need to have a dedicated work area, such as a home office when you work from home.  For more information on record keeping required to claim this deduction please contact us at Balanced Bookkeeping & Tax.

·         Income & The ATO – The powers of the ATO to ensure all income is properly reported by taxpayers has never been this strong.  In the past few years the ATO has devoted increased attention to advanced data analytics to track income payments that have not been reported.  The introduction of Single Touch Payroll (STP) is just one of the ways the ATO has to ensure all income is declared.  The ATO are also able to use data-matching technology to see when taxpayers have sold real property during the year.  This means it is more important than ever to ensure that all income is reported on your tax return and if you are unsure if any income or transaction should be declared, give us a call.

·         Estimating Tax Deductions – The ATO are increasing their scrutiny of tax deductions claimed by everyday wage earners.  Your deductions are compared against other taxpayers in a similar line of work, location, industry, age group, etc to see if your claims are reasonable when compared to this information and their own benchmarks.  Where a taxpayers deductions appear too high in the ATO’s eyes they could ask for a ‘please explain’.  For this reason it is vital to ensure all receipts are kept on hand and the amounts entered in your return are the exact amount from the receipts.  Without receipts for your expenses, you can only claim a maximum of $300.00 worth of work-related expenses.  Do not enter deductions for any estimated expenses, documentation should be kept for all deductions claimed.