With tax time upon us again you can bet that most of us are hoping to improve on last years tax refund. We all look forward to getting that little bonus in our bank accounts and you’ve probably already come up with a few ideas as to how you’re going to spend it.
You might have a little getaway planned, you might want to get your summer wardrobe together or you might want to get a new set of golf clubs. The key in making those dreams a reality is putting a few simple steps in place to make sure you get the most out of your tax refund.
Keep a Logbook
If you use your car for work-related purposes, travel for work or work from home it’s a good idea to keep a logbook. If you have an accurate logbook showing a healthy business use percentage it will provide the basis to maximize your motor vehicle claim at tax time. The alternative method is the km based claim which is limited to 5,000km so if you do more eligible business related km then a log book is a must. We even have a free, downloadable Vehicle Log Book to make this a little easier.
The Small Things Add Up
Remember when you were a kid and your Granddad would give you a bit of change and say, ‘hold on to that, it could be a million dollars one day!’ Well, the same goes for keeping track of your expenses. You may not think it’s worth it to make a note of that meal or bottle of water you bought while away on overnight business trip to attend a conference or visit a client. Those little expenses can really add up over the course of the year. Keeping track of the small expenses is a great way to add a little sweetener to your tax refund – keep all of your receipts, no matter how small they are.
Create a Filing System
There’s nothing worse than turning the house upside down trying to sniff out receipts for those important deductions. The most simple way to keep track of your receipts is to create a specific folder in your filing cabinet and make a habit of putting every receipt and invoice in there as soon as you get them. If you want to make things even easier why not take advantage of one of the many apps out there, like Certify, that allow you to scan all of your receipts and apps onto a cloud via your Smartphone. That way you can scan and forget and you don’t have to sift through a tonne of receipts when it comes to doing your tax.
Embrace Your Charitable Side
People often forget that donations to registered charities can be used as tax deductions. So the $5 you gave at Daffodil Day or the $10 you donated to The World’s Greatest Shave all count as tax deductions. That’s a small amount but if you ramp up your donations or sign up for a larger philanthropic donation you can start adding a serious amount to the bottom line of your tax refund.
Talk to an Expert
Following the above tips will definitely improve the refund but, there is nothing quite like getting the advice of an expert. By enlisting the help of a tax agent you can be sure that you will take advantage of every tax deduction available to you. Tax agents are trained to look at your situation and find deductions and opportunities for an improved refund. A tax agent will also make sure that you maximise your refund without falling foul of the ATO, which is something you definitely don’t want to do.
They can also make sure that your tax affairs are set up so that you can maximise the following years tax return and the year after that by making sure you claim capital losses and gains at the right time. On top of all that, the cost of hiring a tax agent, like OTA, can be deducted from your next return.