Been putting off doing your tax return? It’s quick and easy to lodge if you wait until late July, when the Australian Taxation Office (ATO) will have most of your information ready to be pre-filled into your tax return. The ATO has made it simple for you to handle the process yourself, with all the tools you need to lodge your tax return online before the 31 October deadline. There are clear instructions and explanations at every stage, so it’s easy to do it yourself.

Do You Need to Lodge?

Most people need to lodge a tax return each year. However, if you weren’t working or didn’t have any tax withheld, you may not need to. If that’s the case, submit a non-lodgement advice form. Not sure? Use the ATO ‘Do I need to lodge?’ tool to check. 

Doing Your Tax Return Online With myTax

If you’re an employee or sole trader, you can lodge your tax return online with myTax. The first step is ensuring your myGov account is linked to the ATO.

If you already have a myGov account linked to the ATO, you can log in and prepare your return. Follow the prompts and enter the required information and you’ll have your tax return prepared and your refund calculated in no time. 

When you lodge, remember to check that your phone number, address and bank account details are up-to-date to ensure your tax return can be processed quickly. Most tax returns are processed in less than two weeks. If you’re keen to see where your return is up to, you can check its progress by logging into ATO online services (accessed through myGov) or using the free ATO app.

If lodging online feels daunting, you can use a tax agent. Just make sure they’re registered with the Tax Practitioners Board and contact them before 31 October to see if you can access their later lodgment dates. 

You also need to lodge a tax return if you have a business, even if your business hasn't earned any income or has made a loss. You can find out more about how and when to lodge for businesses.

SEE ALSO: Small Business Tax Deductions to Consider 

What Can I Claim? 

A person wearing a shirt and jeans leans over a coffee table and sifts through receipts. A laptop, phone and calculator are in front of them.

You probably know you’re entitled to claim deductions for some expenses incurred when earning your income as an employee. Regardless of the type of deduction, you must have records to prove it. If the expenses were for both work and personal purposes, it’s important that you only claim for the work-related portion of that expense. A bank statement (on its own) generally isn’t a sufficient level of evidence to claim a deduction for work-related expenses.

“There are a few golden rules for any expense,” says Susan Franks, senior tax advocate at Chartered Accountants Australia and New Zealand. “Firstly, you need to have actually incurred the cost for it. If you've been reimbursed for the expense by your employers, you cannot claim it. Secondly, the expense must relate to your income – any that relate to private use or are capital in nature are not deductible. Thirdly, you need to have documentation of the expense.”

Work-related expenses (depending on your occupation) may include:

There may be other non-work-related expenses you can claim including:

Hot Tip: The myDeductions tool in the ATO app can help you keep these records digitally, and even upload the information to your return making lodging at tax time easier.

If you are still working from home in either a full-time, part-time or hybrid capacity – and let’s face it, that’s a large portion of Australian taxpayers – you can potentially claim a deduction for expenses incurred relating to that work. 

Similar rules apply if you’re a business. You can claim most expenses as business tax deductions as long as:

  • they’re directly related to the earning of your assessable income
  • you only claim the business portion of expenses incurred for business and private purposes
  • you have the records to substantiate your claims

If you are running a business from home, you may be able to claim occupancy expenses, such as a portion of mortgage interest or rent and house insurance premiums, and other home-based business expenses.

SEE ALSO: 10 Tax Deductions You Could be Claiming 

Working-From-Home Calculation Methods 

A person wearing a checked shirt pushing buttons on a calculator and holding a smartphone in their other hand.

There are two ways to calculate your working from home expenses – the fixed rate method and the actual cost method. These methods also apply for home-based businesses.

Fixed Rate Method

If you use this method, you can claim a set rate for each hour you work from home to cover the costs of energy expenses, phone, internet and stationery used while doing your job. You can’t claim an additional deduction for any of the expenses included in the rate per hour.

You can separately claim a deduction for the work-related use of technology and office furniture such as chairs, desks, computers and bookshelves. These are generally depreciating assets that decline in value over time. You can also claim the repairs and maintenance of these items.

To claim a deduction using this method, you will need records of:

  • the actual hours you worked from home, kept at the time they occur
  • evidence for the expenses covered by the rate that you incurred; for example, if you incurred phone and electricity expenses as a result of working from home, keep one phone and electricity bill

You also need to keep records for items you claim as a separate deduction.

Actual Cost Method

The actual cost method allows you to claim the additional running costs directly related to working from home, such as internet costs or printer ink. Just hang on to all your receipts!

If the item or service is used for work purposes and private purposes, you can only claim the work-related portion of expenses. For example, with your internet expenses, you must exclude your private use and the use of internet for any reason by others in your household.

No matter which method is used, if you purchase assets and equipment for work and it costs more than $300, you can’t claim the full amount as a deduction immediately. For each of these items, the deduction must be claimed over a number of years (known as decline in value or depreciation).

Need Help With Your Tax Return? 

If you’re an employee and you need help completing your tax return, the ATO can help. The ATO’s Tax Help program is a free and confidential service open to people earning about $60,000 or less each year who have simple tax affairs.

From July to October, trained volunteers can walk you through all stages of your tax return, from creating a myGov account to completing and lodging your return.

You can receive help in-person at selected Tax Help centres across the country. You can also speak to a volunteer online or by phone.

For more information about the program, including eligibility, visit the ATO website. To make an appointment, call the ATO on 13 28 61.

You may also be eligible to use the National Tax Clinic program to seek support to lodge.

How to Find a Tax Agent

A growing number of tax agents have started offering virtual appointments via videoconferencing platforms, with many adding online forms allowing you to book appointments. Ideally, you send your paperwork to them prior to the appointment via email or a Cloud platform, so you can work through the form together during the call. Some tax agents also use tools such as Xero to allow you to sign documents digitally, rather than printing out and scanning reams of paper.

“Tax agents do a lot digitally, so dealing with clients over video conferencing apps is common,” says Susan. You can search the register to find an agent you’d like to work with.

Other Tax Time Tasks 

Once you’ve lodged your return, it’s time for a bit of financial housekeeping. Here are some good places to start. 

Consider a better filing system

‍There are far better ways to store receipts than shoving them in a shoebox. Document box files and expanding files can help with the organisation of paper receipts, or consider an electronic receipt-storage solution that can integrate with online accounting software. There is also the option of using the myDeductions tool in the ATO app to keep your records – it’s suitable for both employees and sole traders.

Review finance options

‍Make sure they meet your current needs, and any future needs you’re aware of.

Assess your tech

‍Take a look at the latest solutions that can help improve your efficiencies at the office. Possible tax-deductible office upgrades could include a new laptop or printer, updated software, a second monitor, filing cabinets, a new ergonomic chair or perhaps changing to a sit-stand desk. But remember, if you purchase assets and equipment for work and it costs more than $300, you can’t claim the full amount as a deduction immediately. For each of these items, the deduction must be claimed over a number of years (known as decline in value or depreciation).

Make a new financial year resolution

‍Use this time of year to set your financial future on a different course. If you’re spending more time at home, look at your expenditure and consider whether there are ways to save more. Perhaps also consider funnelling a few extra dollars a week into your superannuation savings, which could provide tax savings. Also, check if your super is in good health by using the super health checklist, which can help you get on top of your super by following five easy steps.

What to Try

This is general information only. Seek professional financial and/or legal advice to determine the right outcomes for your business or individual needs.

This article was originally published in 2022 and has been updated.

SEE ALSO: Useful Online Tools From the ATO