As per industry estimates, last year, ATO’s average tax refund amount (Australian Taxation Office) stood at $2,365 (Source Accountants Daily). Filing taxes on time allows you to receive a timely tax refund which could help you strengthen your loan application with a larger ‘Genuine Saving’ amount if you are a prospective borrower. If you are an existing borrower, you could consider investing these funds into your mortgage and quickening homeownership. Here is some helpful information that could make your tax filing process smoother.
- June 30, 2021: This is when the financial year ends. Your Tax return is calculated for a financial year, i.e., July 1 to June 30.
- July 7, 2021: This is when the ATO starts processing tax returns.
- July 14, 2021: The date when most salaried individuals receive PAYG (Summary of tax payments) from their employers
- July 16, 2021: Date by when ATO expects to start paying refunds for filed tax returns
- Oct 31, 2021: Deadline to file your taxes
Documents and information to keep handy
- TFN: Your Tax file number
- PAYG: Payment summary provided by your employer
- Other income: Income from rent, interest, stock dividends, royalties etc.
- Bank Account Details: Your Bank Name, Account Number and BSB in case the ATO needs to process a refund
- Medicare Card: Card number and its expiry date
Claim Tax Deductions
You could claim deductions on several expenses. Do your research and be prepared with expense receipts. Here is a list of some everyday expenses:
- Work from home expenses- tools, equipment, power, and other home office costs
- Medical expenses over $2120
- Super contributions if you are self-employed
- Investment income deductions
- Tax Accountant fees
Also, look at minimising paid tax. One approach you could consider is prepaying your mortgage interest. Make note that is strategy involves fixing your interest rate for a year.
- Prep well by
- Researching all tax claims and benefits, you are eligible for
- Becoming aware of ways to minimise tax to be paid
- Collecting all necessary documents and expense receipts
- File your taxes on time and benefit from a timely refund if applicable
- Consider expediting the process using a professional, especially if the cost is far higher than the tax amount you owe, as you can claim accountant expenses!
The information is a compilation from various sources for your benefit and should not be relied upon in place of appropriate professional advice.
This article is prepared based on general information. It does not consider individual financial objectives or needs and is not financial product advice, and the content is quoted from the Yellow Brick Road Blog.