The Tax Return
The tax return is comprised of 10 main income questions numbered 1 – 10 and 10, and Important deductions are in A-H.
Highlighted items are briefly for the purposes of completeness. Please seek advice and assistance from your Tax Accountants for further guidance…
Income to be included:
1. Salary or Wages – Include in this question your income as per your PAYG summary you would have received from your employer as well as the tax withheld from this income.
2. Allowances, earnings, tips, director’s fees – in this item you include any allowances you receive such, car, telephone, meal, laundry, etc.
3. Employer Lump Sum payments – include any unused annual leave or long service leave payments that you have received from your employer.
4. Employment Termination payment – only include amounts in this section if you have been terminated by your employer whether voluntarily or not.
5. Australian Government Allowance and payments – Youth allowance, parenting and various other Government payments to be included here.
6. Australian Government Pensions & Allowances – include pensions and allowance received from the Australian Government.
7. Australian annuities and superannuation income streams – include your income from superannuation or annuities.
8. Australian Superannuation Lump Sum Payments – include any Superannuation lump sum payments or death benefits received.
9. Attributed Personal Services Income – Include any personal services income you receive.
10. Gross Interest – include any interest you received whether from the bank or other sources.
11. Dividends – include dividends earned whether by a listed company or other.
12. Employee Share Schemes – include the discounted amount you received for shares issued to you by your employer.
Deductions to be claimed against the income:
A. ‘Work-Related’ Car Expenses – complete this section if you travel led for work purposes only. You cannot claim your car expenses by merely travelling to and from home to work. In order to claim your car, it must be for work purposes i.e. needing to deliver something to a customer or travelling to see that customer. Please note that there are four methods of claiming your Motor Vehicle deductions as follows:
• Cents per kilometre
• 1/3 of Motor Vehicle running costs
• 12% of the cost of car
• Log Book Method
Of the above four methods, the logbook method will generally provide you with the greater tax deduction but also requires the most substantiation.
B. Work-Related Travel Expenses – again ensuring only those expenses that are work-related, you can claim, Tolls, Taxi, Train travel, etc. You will need to keep all your receipts to substantiate your claims.
C. Work-Related’ Laundry and cleaning expenses – You can only claim expenses for uniforms, you cannot claim dry cleaning for your suit even though you only wear it for work purposes.
D. Other Work-related’ Expenses – The big-ticket item here is if you have income protection insurance, other items you can include printing, subscriptions and journals that are specific to your field. This will vary slightly from individual to individual. Remember the deduction has to specifically relate to your employment.
E. Low-Value Pool Deduction – complete only if you had assets that you used to produce your assessable income. The assets are less than $1,000 per item.
F. Interest Deductions – Complete this section if you incurred any expenses as a result of earning your interest as per item 10 above. As an example – bank fees.
G. Donations – note that deductions are only available where the organisation is a deductible gift recipient and you must not have received a benefit such as a charitable dinner where part of the “ticket” is for a meal.
H. Tax Return Charges – if you use a tax professional to prepare your tax return, then their fees will be included here.
Again not all the deductions will apply and in some instances, you have nothing to deduct at all, but for those of you that have deductions, you need to ensure you can substantiate the expense and its relevance to you in earning your assessable income.
“Please keep All Tax Invoices for 5 years”
Source: Kochie’s tips for business tax
For more information, visit http://BTEAccountingServices.com.au