This is how you can get the fattest tax return possible

DON’T be among the millions of Aussies who miss out on the tax refund they deserve because they think it’s all too hard.

NOW is the time to get creative with your tax return, as long as you don’t break the law, of course.

Group certificates — now called payment summaries — should have been sent before last Thursday and the Australian Taxation Office has billions of dollars to hand back to taxpayers, but if you want to improve your refund you will need to think a little creatively.

The ATO is great at detecting when you don’t declare wages, bank interest, share dividends and other income, but it has no way of telling you that you have forgotten a deduction for work-related expenses, investment costs or other items.

THINK OUTSIDE THE SQUARE

To maximise your tax refund, think about every dollar you spend that’s related to your work and your investments. Almost any expense incurred in earning an income can deliver a tax deduction.

You’ll have to do some homework, but the extra cash it creates is worthwhile.

NDA Law managing director Andrea Michaels says the ATO has a lot of free information but many people ignore it.

“There are a lot of things you could miss,” she says. “The ATO has publications for different occupations, highlighting the deductions you can claim.”

More than 40 industries are covered, ranging from cleaners and factory workers to teachers and truck drivers.

Three out of four Australians get a professional to help them file their tax return.

About three-quarters of Australians get their tax returns prepared by tax agents and accountants, usually costing between a few hundred and several thousand dollars.

However, you cannot expect a tax agent to magically create deductions from thin air.

“You need the evidence, otherwise there’s a huge audit risk and they’re not going to make stuff up,” Michaels says.

A shoebox full of receipts is no longer vital, because most transactions are recorded online these days, so scour your bank statements for potential deductions.

Anyone trying to be too creative should beware. The ATO compares your deductions with people in similar occupations, and will question you if any alarm bells ring.

“There’s tax avoidance penalties that are quite high, and interest on unpaid tax,” Michaels says. “It will come back and bite you.”

EXPERT ADVICE

H & R Block director of tax communications Mark Chapman says many people don’t get the refund they deserve because of “a mixture of lack of knowledge and a lack of having done the leg work during the year”.

H&R Block’s Mark Chapman says you need to have all your paperwork in order before visiting an accountant.

Get all your paperwork together before visiting a tax accountant, Chapman says.

“Even if you are not sure you can claim a tax deduction, it’s worth taking it in. Go through your credit card statement to see if anything on there is potentially claimable.”

Chapman says it pays to be thorough, so do a quick check in your home. Have you bought anything for a home office, technology used at least partly for work, tools or books for work-related study?

“A tax agent can help you find those things you might not have known about otherwise,” he says.

ONLINE ACTION

Doing it yourself has become easier since the ATO introduced free online system my Tax a couple of years ago. Some taxpayers using my Tax to complete their returns in less than 20 minutes, and early data from the ATO showed that Aussies filing their own returns jumped 60 at the start of July.

While the DIY option can be great for those with simple tax affairs, be aware that you will miss out on money if you forget to claim everything you are entitled to.

@keanemoney