We have eventually arrived at the end of the financial year and it is time to check and put in order accounts, bills, receipts and invoices.
Each year the tax department is targeting a particular category of services or products that can be deducted.
We interviewed Kath Anderson of ATO and Mark Chapman, H&R Block Advisor.
This year the Australian Taxation Office will monitor the expenses related to clothing - including working uniforms - and related laundry expenses. That is because there has been a 20 per cent rise in the number of claims over the past five years, climbing to a value of $1.8 billion.
"That's half of all taxpayers claiming clothing and laundry expenses. Now while many of those will be legitimate, we know that some people are making mistakes, and that's why it's a focus area for us."
"What you can't do is a claim for conventional clothing. So, if you wear a normal business suit, whether male or female, then that's not claimable. If you're working in a restaurant and you're just wearing a pair of black trousers, then that's not claimable."
"They can't claim expenses for normal clothing that they happen to wear to work, even if their boss told them to wear a particular colour or an item from the latest line, or even if they only wear those clothes to work."
"Even if they weren't required to wear a uniform or occupation-specific or protective clothing. Now last year, around 1.4 million people claimed exactly $150. Now many of those will be legitimate, but we know that some people are claiming a standard deduction or a safe amount. Now just to be clear, the $150 is there to ease record-keeping, it's not an automatic entitlement for everybody."
"The tax office views cryptocurrency as an asset, and that means, if you bought and sold or otherwise disposed of your cryptocurrency, there will be tax implications. And, in particular, if you've got a capital gain, you need to include it in your tax return."
"The gig economy is a great way to make some extra income. But you need to remember that you also need to declare that income on your tax return, just like all your other income. And that's the case regardless of whether you're an employee or a contractor."
"Somebody wants to claim a deduction, but they've lost the invoice, they've lost the receipt, they can't prove that they've spent the money, and then the question is very often, 'Can we claim the deduction?' Unfortunately, in that case, very often the answer is no."
Kath Anderson recommends requesting a professional help, when possible, because "We've got some pretty sophisticated analytics and access to lots of data, and we do scrutinise every return. Now this year, we will be increasing our investment, not just in our education and assistance but also in our reviews and audits. So if you're planning to fudge it, just be aware that your chances of getting caught have just gone up."
