21 Dec Five Things You Can Do Now for Your 2018 Tax Refund
Most people don’t worry about tax season until it’s upon them, and with good reason – taxes are mind-blowingly boring. But a good tax refund can provide a boost to the coffers and a nice surprise if unexpected.
But surprises aren’t as good as planning, at least as far as tax is concerned.
Also, you are entitled to it, so not collecting every dollar you are owed is like donating to the government, and I’m sure you can think of several better causes to give to.
So to avoid unnecessary donations to politicians, here are our top tips for making sure your 2018 refund is as solid as possible.
Get Your Entitlements
Depending on what you do for a living, there are plenty of deductions you are eligible for which can assist with increasing your refund. Ask your adviser, or jump on the Australian Tax Office (ATO) website and make a list of everything you can claim for. Look for things like uniforms, travel and safety equipment that is deemed by law to be a tax deduction. Importantly, don’t push it – only claim what you are legally entitled to.
“How much did you spend on X?”
Following on from the first point, you need to be able to answer this question for all of the things you can claim for. Don’t fall into the trap of claiming certain amounts without receipts and hoping you won’t get audited. Audits are annoying and potentially costly experiences and nobody deserves to go through them.
Take your list of everything you are eligible to claim for, stick it to the top of the box and every time you purchase something that is deductible, put the receipt in the box. Extra points if you write what you are claiming for on the receipt.
Doing your own tax return can be a bit of a double-edged sword. On the one hand you can save money on fees, and on the other hand, you may find yourself failing to claim for things that you are eligible for.
Speaking to a professional could mean finding opportunities to save money, or even hidden opportunities you weren’t aware of. The tax code is a complicated beast, and people work for years to become qualified in its intricacies. Forking out a small amount of money for what could be a sizeable return may be an excellent investment.
There may be other opportunities to claim, beyond your professional life. If you own an investment property, or have a small business, then you may have additional expenses and costs that are deemed to be a deduction. Explore this with an expert or spend some time looking through the ATO website, where most questions are answered, albeit generically.
Now that you know what your entitlements are, you can spend your money more effectively. Make sure your financial affairs are well structured and consider investing some money in a restructure if it will have long-term benefits. A short-term analysis and long-term planning can make a massive difference down the line, and save you and your family enormous amounts of money.
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