The I Return is Alive and Well
By Emma Fabbro
There is a lot of media about the removal of the “I” return for individual taxpayers. The Australian Government identifies individual income tax as the “single largest Australian Government revenue source” (www.bettertax.gov.au) and proposals have been put forward which would remove the need for many individuals to submit tax returns.
The proposals suggest a cutting of ‘red tape’ and reduction in compliance and are currently being reviewed as part of the Governments White Paper. Its an interesting thought that an individual would choose the ATO over a qualified accountant and registered tax agent, to determine their taxable income status.
At Johnston Grocke we have clients from a range of backgrounds and industries and we work with all our clients to ensure they are able to maximise their allowable deductions and minimise their taxable income as allowed under our Tax Law.
A very high income earning Australian, Kerry Packer, was famously quoted as saying “Now of course I am minimizing my tax and if anybody in this country doesn't minimize their tax they want their heads read.”
A lot of individuals are not aware of deductions that are allowable to them under our tax system. For example, anyone who wears a work uniform is entitled to a deduction for dry cleaning. If you didn’t use a dry cleaning service, a rate is provided for washing your uniform at home.
Many clients use their personal mobile phone for work purposes and the ATO allows deductions for a rate deemed appropriate for business use. Many of our clients attend conferences or seminars related to their work and which are paid for by themselves personally. The ATO will allow deductions for these costs.
If you perform a portion of your work from home, you can claim for home office expenses. We have clients from certain industries who are entitled to a tax deduction for the cost of sunglasses. On the other hand, clients can face possible fines and penalties if they make claims for items for which they are not entitled to receive a tax deduction.
If individual taxpayers want to ensure they are claiming all deductions to which they are entitled, they will need to continue with submitting a personal “I” return. Using the services of a qualified accountant will ensure that the information regarding your entitlements is current and up to date.