Any errors on your tax return can make you get into trouble. Besides, they can lead you to have unnecessary ATO payments and debts. The Australian Taxation Office works harder to find issues in your tax return every year. As a taxpayer, you can avoid having trouble if you file your tax returns without any mistakes.
Here are five errors most of you make in your tax filing:
1. Guesswork on tax deduction
The ATO is fanatical with the claims of tax deductions made by the common people of Australia. They could be more serious about finding issues in tax returns of big businesses that keep profits and assets hidden. In fact, the tax officials are strict with each one while collecting tax. It means every one of you needs to be more careful.
The one thing is that Australian tax officers do not know the exact amount of your tax deductions. And this unfamiliarity makes them a little uncomfortable here. It doesn’t mean you should be creative and make false claims. They check everything that you claim. So, avoid guessing work and mention what actually can make you to avail deductions in your tax return.
2. Estimation of income and tax paid
While mentioning your income and what you paid as tax, you must avoid guessing work. Instead of estimating, show the actual figures and the amount you have earned and paid. You should do it, as the ATO has all the relevant records on the associated payments you have made. They have the right to do cross-checks of your personal and business accounts.
3. No proofs of shopping or no receipts for deductions
It is a blunder to not to keep a record of work-related items. Without any proof or receipts, you can make a deduction of only $300, which can be higher or lower than actual deductions. You must keep receipts for all the expenses you have made, and those expenses must be the actual ones. Avoid showing wrong proofs for your business expenses.
4. Over-claiming on rental or holiday property
Most of you make mistakes showing expenses on residential/commercial rental and holiday properties. Avoid doing this, as they are abiding by strict rules and make you clear whether you can claim or not for your residential or holiday property rental. You are not free to make claims for all your expenses, especially holidays and personal residence.
5. No declaration on overseas income
Many of you (Australians) work overseas for a period and forget to pay taxes on that income. Usually, most of you think you would not have to declare such income after returning to Australia. No declaration of foreign income is a bad habit. You must avoid it to have a peaceful life.
Willingly or unwillingly, you make mistakes while filing your tax returns. Some mistakes are very common, and you should contact a professional accountant for tax return Sydney if you find how to avoid those errors. The expert will do your tax returns on your behalf and help you to escape from any penalties from the ATO.