To mark the launch of our 2014 franchise program, this week Mr Tax Refund appears in the October / November issue of Business Franchise Magazine. Keep an eye out for it in newsagents everywhere or click below. Also check out our full page advertisement.
As an owner of an investment property you may be eligible for a number of tax benefits.
One of the more significant of these is claiming depreciating assets in your tax returns.
As defined by the Australian Taxation Office (ATO), a depreciating asset is “an asset that has a limited effective life and can reasonably be expected to decline in value over the time it is used”.
A good example of this might be a set of tools or perhaps a computer.
Through your tax return in Australia, you can deduct an amount equal to the level of decline in value of your depreciating asset. This can be deducted for a specific income year.
The amount you can deduct may be reduced to the extent of the use of your asset.
Most of the depreciating assets in your rental property are there to help provide you with assessable income; however there are some assets you might not be eligible to claim.
Some examples of depreciating assets you can claim include freestanding furniture, washing machines, television sets and stoves.
Calculations for these can be a little tricky to get your head around, so it may be wise to get some advice from a tax agent to help you prepare your tax return for your rental property.
As a high school student, it’s likely that you will want to earn some pocket money while you’re still studying.
Perhaps you will pick up a few regular shifts at a restaurant at night, or maybe spend your weekends working at a shop.
Working while you’re studying is a great way to save up over the year and contribute to university costs, or maybe purchase your first car.
But those aged under 18 who work in Australia can have their income taxed at a higher rate than normal.
If you were aged under 18 on June 20 2013 (the end of the last financial year) then you could find yourself paying more tax.
However, some individuals may have part of their income excepted from these higher rates.
This means that you will need to complete the Under 18 Adjustment section of your tax return in Australia to ensure that you are not going to get taxed more than you need to.
If you haven’t lodged a tax return before and would like some expert assistance, get in touch with a tax agent to help you through the process.
Many of us choose to look after older or sick relatives for extended periods of time. It’s human nature to do so!
You may give up a few hours per week to take care of their daily needs, or perhaps pay for some of their medical or education expenses.
However, the cost of performing these duties can all add up to quite a substantial amount.
If you’re looking after a dependent spouse, parent or child, then you may be entitled to claim a tax offset in your tax returns.
To be eligible, the dependent must be an Australian resident for tax purposes, be an invalid and be either a spouse; you or your spouse’s child, brother or sister aged over 16; a parent; or your spouse’s parent.
This tax offset can help you to limit the amount of tax you are paying in your income tax return in Australia.
It’s important to note there are guidelines that apply, such as the Adjustable Taxable Income (ATI). This can vary depending on how many dependents you maintain and the level of income you and your dependents receive.
If you have dependents and would like to see if you’re eligible for tax offsets, get in touch with tax agent for assistance.
Negative gearing is a very common investment strategy in Australia and has a number of benefits.
The strategy occurs when the costs associated with the property outweigh the rental income received. This could be a property that has been purchased with borrowed finance and doesn’t receive enough funds from the rent to pay off the interest on the loan, resulting in a loss.
There are many things that owners of negatively geared properties need to remember when lodging their annual tax return in Australia.
Owners can claim tax deductions for the full amount of expenses related to their rental property against their rental income and other types of income if a net rental loss occurs. This includes salary, wages or business income.
If the other income earned isn’t enough to cover the loss then it will be carried forward to the next financial year.
Claiming expenses for your negatively geared property in your tax returns would then result in you receiving a tax refund for that financial year.
As an investor, it’s up to you to decide which property investment strategy is best suited to your lifestyle and portfolio.
As the owner of an investment property, it’s likely that you’re going to want to minimise your expenses as much as possible.
However, some of our expenses are beyond our control, such as a burst hot water cylinder or perhaps an endless-flushing toilet.
The expenses you pay for advertising your property for rent can be claimed as tax deductions. And that’s fortunate too, as this can add up to quite a large amount. However, it’s all necessary in order to get your property tenanted.
As an investor, you will want to take care of your previous investment and make sure you have acquired adequate insurance. This can be claimed as a tax deductible expense, including building, contents and public liability insurance.
Owning a property means you are responsible for repairing and maintaining it on a regular basis. The Australian Taxation Office allows your to claim these expenses in your tax returns as deductibles, allowing you to keep your costs down to a minimum.
In order to process your tax returns in Australia, your tax agent will need some information about you. This includes proof of income, bank account details, expenses you will claim as tax deductions, and of course, proof of identity.
While many people can keep these records on hand in a safe place, a number of others can forget one of the most important – their Tax File Number (TFN).
It’s not legally required to obtain a TFN from the Australian Taxation Office (ATO), however if you’re thinking of lodging tax returns at some point then you will need to get your hands on one.
Your TFN is also necessary for the application of some government benefits and assistance and if you wish to start work or change jobs.
The process for this is extremely simple – just head to the ATO website and you can apply for one online.
Once you’ve done this, you will need to take your documents (such as proof of identity) into a participating Australia Post brand to verify your identity.
After that, you can expect to receive your TFN number in the mail within 28 working days. Keep it in a safe place so that you don’t forget it for your tax returns!
It’s hard to control when unexpected costs are going to pop up, but don’t they always seem to arise at the worst times?
Maybe you’ve just paid your car insurance for the year, only to find that your refrigerator motor has blown up?
Perhaps your winter power bills took a chunk out of your savings but you need to get your car serviced.
Even some of the savviest savers amongst us may have an expense or two that blows the budget, creating the need for quick cash.
If you need to get your hands on some money quickly, for just $100 you can receive an advance on your tax refund and gain access to the cash in one business day.
That means you can go get your refrigerator repaired, put some new tyres on your car and maybe you’ll have a little spending money left over.
There’s no point stressing over the small stuff, so get your tax returns in today!
Australia is host to a number of international visitors each year, consisting of backpackers, travellers, returning permanent residents or temporary residents.
One of the most important factors that depends on your residency status is how much income tax you are charged.
People who are residents of Australia for tax purposes can take advantage of the tax-free income threshold of $18,200. Each dollar earned over this amount up to $37,000 is then taxed at 19 cents for every $1.
Residents can claim tax offsets in their returns and need to declare any income they have earned in any place in the world.
Those who aren’t Australian residents have a much higher tax rate. From $0-$80,000 non-residents are charged 32.5 cents for every dollar. They aren’t entitled to the tax-free threshold, but they don’t have to pay any of the Medicare levy.
Non-residents only have to declare any income they have earned in Australia, and they can claim some offsets in their tax returns.
For more help understanding what residents and non-residents are entitled to, get in touch with a tax agent to process your returns this year.
Not everyone enjoys sorting out their tax returns each year – and understandably so! The process can be a bit of a drag, especially if you’re trying to understand the Australian taxation system for the first time.
This dread may have resulted in you leaving your tax returns to the last minute.
But did you know that lodging late tax returns after this date may result in you receiving a penalty.
These penalties can take quite a significant chunk out of any tax refunds that you receive, leaving you with less money to enjoy in the end.
However, not everyone is able to get their returns in on time. In these cases, there is an extension that you can receive.
If you register with a tax agent, such as Mr Tax Refund, before tax season ends on October 31, then you can have an extension until May 15 next year.
Although it means you won’t receive your refund that maybe due until next year when your return has been processed, it does mean that you have extra time to get your return together.