Tax time deadline looms: how to boost your refund

Tax season ends soon and many Australians are yet to file their returns, potentially delaying a handy refund boost.

The looming October 31 deadline for individuals’ tax returns could carry a $1500 bonus for many Australians.

More than 8.3 million people lodged their returns between July 1 and October 1, according to new Australian Taxation Office data, and more than 6.8 million tax refunds were paid.

“That’s four in five Aussies who typically get a refund – so you have got some pretty good odds in your favour, better odds than tipping the Melbourne Cup winner,” says ATO assistant commissioner Tim Loh.

“It’s a good opportunity to lodge your tax return,” he says.

The latest lodgement figures are slightly higher than at the same time in 2021 but there is still a large chunk of tax returns to be filed – the ATO received more than 14.3 million individual lodgements for the 2020-21 financial year.

The ATO’s Tim Loh says doing your tax can be easier than getting your kids to eat dinner.

Millions of people will extend their tax deadline until May by linking with a tax agent, and H&R Block director of tax communications Mark Chapman says to do this they must be registered with an agent by October 31.

Chapman says an extra reason to lodge sooner may be the government’s $1500 Low and Middle Income Tax Offset being offered to millions of Australians, likely for the last time.

It delivers up to $1500 of tax back after people lodge their return, and people earning below $126,000 receive some or all of the offset.

“For those who earn less than $37,000, the offset is $675,” Chapman says.

“Those with annual incomes of between $48,000 and $90,000 will receive the full $1500 offset,” he says, while others receive partial offsets.

“If your taxable income falls within the range, absolutely, it’s an early Christmas present.”

Chapman says legislation ended the offset after the 2021-22 financial year, but the October 25 budget may deliver welcome news.

“I wouldn’t be entirely surprised if the government introduces something similar to this for next year, because (stopping it) effectively amounts to a tax increase,” he says.

Chapman says many Australians are leaving dollars “on the table” in unclaimed tax deductions, especially around working-from-home expenses.

“You have a choice of three different methods for making your claim; the 80c per hour flat rate, the 52c per hour flat rate or the actual cost method,” he says.

“Crucially, while it may sound like the most generous, the 80c rate does not allow you to claim anything else for working from home. The 52c rate, however, allows you to make separate claims for the work-related proportion of items such as your home internet, mobile phone costs, depreciation of computer equipment, stationery, and printer ink.

“For someone working from home for the entire tax year, that could amount to about $1200 in extra deductions.”

The ATO’s Loh says there have been more work expense deductions this year.

“The strongest gains have been in work-related travel deductions, which is not surprising given the easing of border travel restrictions,” he says.

“Working from home claims remain elevated, as do claims of PCRs and RATs, and that’s what we expect with a lot of people returning to work a little bit more.

“We have seen an increase in the amount of capital gains reported, which we think is reflective of the widespread increases in asset prices throughout 2021-22.

“The growth is in line with what we expect given the property sales data that we have, coupled with data on dividends and information that’s provided by crypto asset exchanges. We know what people are doing and we will use that information to data match.”

People can lodge online through the ATO’s myTax service on the myGov platform.

“If you have got simple affairs, you can lodge through our service in less than 30 minutes,” Loh says.

“It’s easier than getting your kids to eat dinner.”