Common Tax Time Mistakes
The ATO recently stated that they will be taking a more proactive approach this year when it comes to tax time. He we highlight some common mistakes that taxpayers are making.
Leaving out some of your income- Most of your income is pre-filled from details received from employers and financial institutions. However, income such as rent from an investment property and interest may need to be captured manually and must be declared.
Claiming deductions for personal expenses - such as home to work travel, the purchase of work-related clothing, laundry claims and private phone calls- Generally, you can’t claim for normal trips to and from work as this is considered private travel by the ATO. Work-related clothing has to be specific to your occupation, is not everyday in nature and allows the public to easily recognise your occupation. Claiming for laundry (or cleaning of work clothing) is only on eligible work clothes.
Failing to keep receipts and records- Each year the ATO makes adjustments due to the taxpayer having no records or poor-quality ones. You need to have a receipt on file if you are claiming for that expense as proof. Ensure you take a picture or scan as some receipts fade over time.
Claiming standard deductions for something you never paid for- When claiming a deduction, you must have spent the money yourself and not have been reimbursed. Additionally, the expense must be directly related to the earning of your income.
BlueKite Capital clients have access to a solution that will help you to avoid these common mistakes – MyBlueKite. The portal has a tax preparation wizard and functionality to make your life easier.
Sign up to MyBlueKite and contact us on 1300 883 594 to get advice on avoiding these common mistakes.