It is advisable that you do your tax planning throughout the year in a very meticulous way. This will ensure that you are able to take advantage of all the tax deductions and refunds that you are eligible for. You should consolidate all your paperwork and documentation multiple times throughout the year so that you do not have to hurry before the submission deadline. The best tax agent Perth has to offer will also advise you to approach tax filing in a very methodical way. You will be able to save a substantial sum of money if you apply for all the tax deductions and refunds that you will be eligible for. Here are some suggestions of how you can use the saved money to prepare for your family’s future financial needs.
- Contribute to your superannuation fund: The best thing you can do with saved money is put it in your superannuation fund. Not only will that help you later on when you retire, but you can also withdraw for other needs such as college loans, emergency medical bills, etc. It is always a great idea to contribute to your superannuation fund as much as possible.
- Get closer to paying off your home: By using the saved money from tax refunds to pay off your mortgage and home loans, you can cruise towards a comfortable retirement. Filing for deductions and refunds properly will help you to gain significant savings and also reduce the mortgage due on your home loan quickly.
- Go on a holiday: If you and your family are feeling stressed and you haven’t taken a holiday in a long time, then you can use the money you save for a nice and relaxing weeklong holiday somewhere. Saving money from personal and BAS tax returns is great because it allows you to invest the money in other fruitful areas.
Here are some tips that will help you take advantage of your tax savings before the year-end.
List all your Fringe Benefits Tax (FBT) exempt items
You can buy equipment that you need for work and file them as tools of the trade, which is a category of goods that fall under the FBT-exempt bar. It is an effective way for you to stack up on equipment and also enjoy a significant tax benefit at the same time. Some of the items that you can contribute to this bracket include your laptop computer, software, mobile phone, protective equipment, cameras, briefcases, etc. For specialized professions, you can obviously list out all the specific equipment that you need during work under this bracket. If your employer does not reimburse you for these items, you will be eligible for a refund from the Australian Taxation Office (ATO). Make sure you have the invoices of these items at the ready.
Maintain a logbook for your vehicle
You can actually claim deductions and refunds if you meticulously maintain a logbook for your motor vehicle(s). To be eligible for any deductions, you have to keep an accurate logbook for at least 12 weeks. Make sure that the starting date for that tracking period is after June 30, 2019. The best way to stay on top of this is to take odometer readings after the given date and keep all vehicle-related receipts and invoices in a safe place. Fuel receipts, repair receipts, etc. should all be stored methodically in a safe place for later perusal. If you don’t think you can maintain a logbook, then you can also claim deductions for 5000 kilometers for business reasons by using the cents per km formula.
Maximise tax-deductible superannuation additions
You can add to your superannuation fund regularly to make sure that these additions are tax-exempt. That way, you will be able to save a significant sum of money. However, you must be careful not to exceed the concessional limits that are set each year by the ATO. After your yearly contributions cross a certain amount, your superannuation fund will be subject to taxation. For example, the concessional limit for the 2019-20 financial year was 25000 AUD. The only thing to remember is that excess contribution is treated as income by the ATO and will be judged under personal tax return or expat tax return.
Low & High-Income Earning Individuals
Individuals whose spouse earns a yearly income of less than 37000 AUD are eligible for special tax concessions and refunds from the ATO. These refunds will stop if the spouse’s income reaches 40000 AUD. Similarly, individuals earning more than 200000 AUD annually are liable to pay a special tax if their superannuation contribution exceeds a certain amount.
Choose top tax professionals
The best way for you to claim all the refunds you can is to consult the best tax consultant Perth has to offer. They will help you to navigate all the red tape and formalities and will ensure that you save a significant amount of money in the form of refunds and concessions.