This article has been written by our associates at Gabriel and Co Accountants. They specialise in individual, small business and SMSF taxation and work with a number of our clients on a variety of matters.
WIth the new finanical year upon uss, it is important our tax returns have been completed properly - If you need an accountant, we highly recommend speaking to Georgia, and the team at Gabriel and Co.
You can visit their website at www.gabrielco.com.au
Give them a call at: 03 9372 8600
Or get in touch with me and I would be happy to introduce you!
Disclaimer: We are not tax accountants, the below is of general information only and you should discuss it with your accountant before acting on any information.
ATO Warning - Check your work related expenses
When the Australian Taxation Office (ATO) reports that around 8.6million taxpayers made over $22 billion dollars in Work Related Expense (WRE) claims, costing the budget around $8 billion dollars, one thing is clear - this year the ATO is focusing on the deductions you are claiming in your tax returns.
In a recent ATO random review of 1000 tax returns they found that 7 out of 10 were required to be amended for incorrect claims! So what can you do this tax time to ensure your claims are legitimate and that if you are randomly selected you can successfully pass an ATO review?
The ATO expect all deductions to pass the following test:
You have spent the money and were not reimbursed.
The deduction is directly related to earning your income (chances are if your employer is unable to confirm your claim is work related then it will be disallowed).
You have a record to prove it (log books, work related percentage calculations, tax invoices, receipts, proof of how payment was made).
The most common mistakes the ATO find are over claiming for private expenses, incorrect motor vehicle claims, clothing and laundry claims and overseas travel and conference claims.
If you, or your tax agent, have been claiming the same expenses year after year it's time to review this practise, ensure your claims are legitimate and can successfully pass the ATO deduction test. The ATO simply want you to claim what you are entitled to - no more, no less. (source: Australian Taxation Office www.ato.gov.au)
DISCLAIMER: The information contained within our website is of a general nature only and has been provided without taking account of your objectives, financial situation or needs.
Because of this, you should consider, with or without the assistance of a financial adviser or tax accountant, whether the information is appropriate in light of your particular needs and circumstances.