Channel 9 1 July 2020
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The Australian Tax Office’s website has struggled in the last few days proving that more people than ever are desperate to receive their refund.Thanks to increased financial pressure from COVID-19, many taxpayers are sweating on using their refund for daily costs.But rushing through your return – or relying on age-old myths your neighbour’s brother’s tax agent said 10 years ago – leads many to filling out their return incorrectly.At best, this will slow down your tax return, and at worst you could face financial penalties for attempting tax fraud.Here’s six common myths and traps the ATO believes will catch out some taxpayers this return season:
It’s true that most taxpayers who lodge their return online will have their refund (if they are entitled to one) sitting on their account for ages. But lodging your tax today – particularly if you are relying on your employer to provide your income to the tax office – could actually slow your return down.”Each year the ATO automatically includes information from employers, banks, private health insurers (and this year JobKeeper for employees and JobSeeker amounts) in people’s returns,” the ATO advises.”For most people this information is ready by the end of July.”
Claiming work from home costs? Beware of ‘double dipping’
Thousands of Australians will be claiming working from home costs – such as cooling, electricity and internet – for the first time due to COVID-19.For many, that will involve using the ATO’s special “shortcut method” of 80 cents per hour you worked from home. But the ATO has warned that the 80 cent covers everything – including home office equipment – so some taxpayers might find themselves ‘double dipping’.”We are concerned that some taxpayers may either accidentally or deliberately double dip by claiming their working from home expenses using the all-inclusive shortcut method while also claiming for specific items such as laptops or desks,” Assistant Commissioner Karen Foat said.”It’s important to remember that if you’re claiming under the shortcut method, you cannot claim a separate additional deduction for any expenses you incur as a result of working from home.
Stephen is the CEO of Accountants Direct and is a Professional Director, ASIC Agent, Startup Advisor & Investor & Capital Raising Specialist.
Contact Stephen or his team if you have any questions about this post or any business matter in general.