Tax return tips
Getting tax right
It's tax time again so here's our guide to what you can and
can't claim in your 2018 tax return, and tips to make lodging your
tax on time a breeze.
Records you'll need
to complete your tax return
Before you sit down to do your tax, you'll need to gather all
the right information. Here are some of the documents you'll need
to complete your tax return.
- Payment summaries - Outlines the income you
have received from your employer, super fund or government payment
like Centrelink and the Department of Veterans Affairs.
- Bank statements - Details any interest you
have earned during the period and fees you have paid. Your
bank may have summarised these for you, either online or at the
bottom of your bank statement.
- Shares, unit trusts or managed funds
statements - Information on dividends or distributions
you've received. Dividends that you've elected to reinvest must be
declared as income.
- Buy and sell investment statements - Needed to
calculate capital gains and losses. If you bought or sold any
shares you can access the details on your online broking account or
you can get them from your investment adviser or stockbroker.
- Records from your rental property - If you use
a property manager, you will probably get an annual tax statement
that details income and expenses. Otherwise you will need to gather
details of income received and expenses paid, including any capital
gains or capital losses if you have sold the property.
- Foreign income - Details of foreign pensions
or other foreign income.
- Private health insurance policy statement -
Information needed to complete the private health insurance section
of your tax return.
Income you must declare
You can do your tax online using myTax. You can access myTax
through myGov or the Australian Taxation Office
If you wait until mid-August, the ATO will pre-fill your tax
return with most information from employers, banks, government
agencies and other third parties. You just have to check the
information, enter any deductions you have, and submit.
If you lodge your tax return before the information is
pre-filled, here's a list of common types of income that must be
declared on your tax return:
- Employment income
- Super pensions, annuities and government payments
- Investment income (including interest, dividends, rent and
- Business, partnership and trust income
- Foreign income
- Income from crowdfunding (for example, donations received for a
venture in which you intend to make a profit)
- Income from the sharing economy (for example Uber or Air
- Other income - including compensation and insurance payments,
discounted shares under employee share schemes, some prizes and
Visit the ATO's website for more information on income you must
Tax deductions you can
When completing your tax return, you're entitled to claim
deductions for some expenses, most of which are directly related to
earning your income (called 'work-related expenses'). A deduction
reduces your taxable income, and means you pay less tax.
To claim a deduction for work-related expenses:
- you must have spent the money yourself and not been
- it must be directly related to earning your income
- you must have a record to prove you paid for it.
When your expenses meet these criteria, here's a list of the
things you may be able to claim.
- Vehicle and travel expenses - This does not
normally include the cost of travel between work and home but, if
you use your car for work or work in different locations, then you
may be able to claim a deduction.
- Clothing, laundry and dry-cleaning expenses -
To legitimately claim the cost of a uniform, it needs be unique and
distinctive, for example it contains your employer's logo, or is
specific to your occupation, like chef's pants or coloured safety
- Gifts and donations - to organisations that
are endorsed by the ATO as deductible gift recipients.
- Home office expenses - Costs could include
your computer, phone or other electronic device and running costs
such as an internet service. You can only claim the proportion of
expenses that relate to work, not private use.
- Interest, dividend and other investment income
deductions - Examples include interest, account fees,
investing magazines and subscriptions, internet access,
depreciation on your computer.
- Self-education expenses - If the study relates
to your current job, you can claim expenses like course fees,
student union fees, textbooks, stationery, internet, home office
expenses, professional journals and some travel.
- Tools, equipment and other equipment - If you
buy tools or equipment to help earn your income, you can claim a
deduction for some or all of the cost. Examples include protective
gear, including sunscreen, sunglasses and hats if you work outside,
office equipment, safety equipment and technical instruments.
- Other deductions - Other items you can claim
include: union fees, the cost of managing your tax affairs, income
protection insurance (if it's not through super),
overtime meals, personal super contributions and other expenses
incurred in the course of earning an income.
The ATO's website has more information about
these types of expenses. They have also created a series of fact sheets explaining what expenses are tax
deductible for specific occupations, including teachers,
hospitality workers and tradies.
Make it easier for next year
The ATO's myDeductions app
makes record keeping easier. The tool allows you to record
deductions including work-related expenses, gifts and donations,
interest and dividends. It also lets you store photos of receipts
and record car trips. The myDeductions app can be used by
individuals and sole traders (sole traders can use it to keep track
of business income) and at tax time you can send your deductions to
your tax agent or upload them directly to myTax.
What tax deductions
are not allowed
The ATO is focused on helping taxpayers get their deductions
right, but they're also on the lookout for red flags that identify
people who are doing the wrong thing.
Here's a list of deductions you usually can't claim on your tax
- Travel between home and work - which is
generally considered private travel.
- Car expenses - unless you are transporting
bulky tools or equipment that your employer requires you to use,
and you cannot leave it at work.
- Car expenses - that have been salary
- Meal expenses - unless you were required to
work away from home overnight.
- Private travel - including any personal travel
portion of work-related travel.
- Everyday clothes - you bought to wear to work
(for example, a suit or black pants), even if your employer
requires you to wear them.
- The cost of laundering eligible work clothes -
unless you can show how you calculated the cost.
- Higher Education Loan Program - contributions
charged through the HELP scheme.
- Self-education expenses - where there is no
direct connection to your current employment.
- Phone or internet expenses - that relate to
- Tools and equipment that cost more than $300 -
however, you can depreciate the cost over a number of years.
Test your understanding of income you must declare and what you
can and can't claim with the ATO's tax
time quiz. If you're still not sure what you can or can't claim
visit the ATO or a registered tax agent.
Lodging your tax return in
You can lodge your tax return online using myTax - it's quick,
easy, safe and secure. If you haven't already set up a MyGov account, you'll need to create one and
then link to the ATO. Visit the ATO website to find out how to lodge online.
Check your super while you are logged into MyGov. Just click on
the 'super' tab, to see how many funds you have. You can even consolidate your
funds on the spot if you know which one you want to
If you have a spouse you will also need details of their income
and expenses to make sure your entitlements are correctly
Once you have lodged your tax return keep an eye on your myGov
inbox for your notice of assessment and tax receipt.
Lodge your return before the deadline
If you're lodging your own tax return, you have until 31 October
2018 to lodge it. If you decide to use a registered tax agent, or
are using a different agent from last year, you will need to
contact them before 31 October.
Get help from a registered tax agent
If you want to use a professional to do your tax return, make
sure you use a registered tax agent. You can check if the agent is
registered on the tax and BAS
Whichever way you choose to lodge your tax return, remember you
are responsible for the claims you make, so make sure your
deductions are legitimate and you include all your income before
you or your agent lodges your return.
Make tax this year as easy as possible by
getting organised and knowing what information you will need to
Last updated: 05 Dec 2018