Kiddipedia
With just a few weeks to go until the end of the tax year, you might think it’s too late to knock your taxes for the year into shape. But even this close to EOFY, there are still some last minute planning opportunities to maximise your refund for the year. So, what should you be doing as we head towards June 30?
Here are some top sneaky tax tips to help point you in the right direction.
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Gather written evidence
Make sure you have written evidence of everything you intend to claim:
- receipts
- invoices
- bank or credit card statements.
The ATO might well ask to see this verification as part of an audit and without it, your deductions will be struck out.
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Home Office
If you work from home, either occasionally or all the time, you are entitled to deductions for costs arising from working at home. The expenses that you can claim include:
- heating, cooling and lighting
- cleaning costs
- decline in value (depreciation) of home office furniture and fittings, office equipment and computers (for items over $300)
- computer consumables, stationery, telephone and internet costs
- items of capital equipment (for eg furniture, computers and associated hardware and software) which cost less than $300 can be written off in full immediately.
You can claim actual costs but you’ll need copies of all invoices plus a reasonable estimate of the percentage split between work-use and private-use. Or, alternatively, the ATO fixed rate of 67 cents per hour.
To claim the fixed rate, you must be able to prove the number of hours that you worked from home during the entire tax year, so you’ll need a diary, copies of timesheets or rosters.
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Car expenses
If you use the log-book method, now is the time to check that your log-book is up-to-date and that you have all the receipts, invoices and records of journeys which you will need to calculate and substantiate your claim.
If you use the cents per kilometre method, you will still need a record of all work-related journeys during the year.
Be aware: you can only claim 5,000km per year if you use the cents per kilometre method.
The ATO will be looking particularly closely at car claims this year, as they suspect many people are over-egging their deductions. For example, claiming the maximum 5,000 km for the cents per km method without actually doing 5,000 km or… doing any work-related kms!
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Mobile phone
If you used your personal mobile phone for work purposes, you can claim a deduction for the business related use. Make sure you have your phone bills collected together and have kept a log of your business/personal use over a four-week period. That percentage can then be applied to the whole year.
Important: you can’t make a claim for mobile phone use if you have claimed the fixed rate method for working from home. Mobile phone calls – wherever they are made – are included in the 67 cents per hour rate.
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Charitable donations
Make a last minute charitable donation. You can claim a deduction for donations of more than $2 to a registered charity provided you have a receipt for the donation.
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Prepay some expenses
You can claim a tax deduction this year for expenses which wholly or partly relate to next year. So, if you have some spare cash, consider paying things like union fees, professional subscriptions and annual insurance premiums in advance to accelerate the deduction.
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Buy a new handbag
If you use a bag for work, to carry papers or a laptop perhaps, you can claim a tax deduction for the cost. That could include a briefcase, a backpack or a handbag, whichever suits your needs.
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Seek expert help
Speak to a tax agent like H&R Block. They can identify exactly what you need to do to get into shape for the 2024 tax season and maximise your deductions.
Mark Chapman, Director of Tax Communications at H&R Block.
