October 31 is crunch time if you prepare your own tax return. If you're preparing your 2017 tax return yourself, you have just more than a week to lodge with the Tax Office to avoid any penalties.
For those who are organised and have already lodged, congratulations! Hopefully you've received your refund and have already invested it wisely. For everyone else, you need to get moving. If you've chosen to lodge yourself you need to clear a couple of hours, maximise your refund and avoid penalties. If you've chosen not to lodge yourself, then you can buy yourself some time. Either way, you need to act now.
If you're tempted to bury your head in a big pile of cashmere (much softer than sand) then here is my easy, fool-proof guide to ensure you sort yourself out and receive your cash (or choose an accountant) before the deadline hits.
1. Register at MyGov to lodge with myTax. MyTax is available free to anyone preparing their own individual tax return, including sole traders. It works on any device (computer, smartphone or tablet) and the nice thing is that it's personalised for you. This means if you're freaking out because you can't find a payment summary, simply log online and you may find it's there uploaded and waiting for you. MyTax prefills information provided by employers, banks, private health funds, government agencies and more. All you need to do is complete any missing income information and complete your deductions.
2. Claim everything you're entitled to. Chances are you haven't used the myTax app to keep track of your deductions otherwise they'd be uploaded and you would have submitted by now. Perhaps download it and starting using it for next year. When you're completing your own tax return it can be too easy to dig out your receipts (once you've found them in the folder you popped at the back of the cupboard or in the glove box for safekeeping), enter them and then stop. That's because receipts are only part of the story when it comes to deductions. Make sure you look through your bank statements online to remind yourself of other expenses you might be able to claim. The Tax Office will often accept your bank statement as proof of the deduction. Also consider expenses you don't receive a physical receipt for, such as kilometres travelled for work as well as light and heat when you're working from home. Head to your diary to calculate if you used your car for deductible work trips and where you might have travelled. Remember to include tolls if you used those, too. Examples of common claims if you need a memory jog include:
a. Motor vehicle usage: either from a logbook or up to 5000 kilometres at a set rate
b. Uniforms and protective clothing
c. The cost of study and professional education
d. Phones, internet, computers, books and resources, software and stationery
e. Light and heat when working from home
f. Sun protection including sun glasses and SPF in foundations and moisturisers if working or travelling outside
g. Donations
h. Income protection insurance, professional memberships and registrations, union fees.
3. Don't forget to include other income such as rental income and expenses, profit made on the sale of shares and if your hobby income has crossed the line into business income. If you're tempted to not include some of this income be aware the Tax Office is tracking your tax file number and social media and you may receive a "please explain" letter in the future.
4. If you know you won't be ready by the deadline, contact the Tax Office before October 31 and ask for an extension. They're generally reasonable (crazy notion, right?!) if you have a genuine reason for not lodging in time.
5. If you've decided it's all too hard then appoint an accountant before October 31 and take advantage of the extended deadline. Of course, if you've earned less than $18,000 simply log on to myTax, don't worry about deductions and hit submit. That's because you'll receive all your tax back because of the tax-free threshold! But for anyone else, you might consider an accountant. My advice here is to shop around and make sure you're using someone who understands everything you can claim but isn't prepared to step over the line. All accountants aren't created equal and the accountant that's right for your kids who have simple needs might not be right for your more complex situation. Ask for referrals, check out websites and whoever you choose, make sure they ask you lots of questions. Great accountants should spend most of their time asking you loads of questions, not inputting data.
That's it. The Tax Office has made it so easy for you to deal with it directly using myTax but if you know you're going to nudge over that deadline make sure you ask for an extension or talk to an accountant.
