While there’s always new changes in tax rules to absorb, the fundamental principles of getting your tax return in on time (and your refund as fast as possible) don’t change from year to year. Here’s the most important things to remember.
Picture by lexnger
Here at Lifehacker we cover Aussie tax issues pretty regularly, and how to get yourself organised — the most crucial step in our humble opinion — even more regularly. So as part of our Tax Week 2010 coverage, this week’s Loaded column rounds up the most important steps to making tax as stress-free as possible. For the most part, we’re not dishing out financial advice — the emphasis here is on making sure that the tax experience is relatively free of hassle and that you get what you’re entitled to.
5. Make an intelligent decision about using an agent
Aussies are extremely keen on getting a professional to manage their tax — according to the ATO, almost three-quarters of us did so last year. If you’ve got a relatively complicated financial situation (such as a rental property), that makes sense, and the fact that fees for professional tax return preparation are themselves deductible as a taxable expense means many people simply put the whole thing in the “too hard” basket.
That said, if you are working in a salaried job, know which deductions are allowable and keep records as you go along, the expense of a tax agent might not be worth it. Even if you do use an agent, you remain ultimately responsible for the contents of your return, so approaching it in an informed light is much more sensible.
4. Avoid common mistakes
However you choose to submit your return, making an error can cause delays and unnecessary expense. There’s a handy checklist of common tax return mistakes from the ATO that’s worth checking before you submit. And don’t assume mistakes just happen on your side. If the assessment you eventually receive from the ATO seems horribly out of whack, challenging it often has positive results.
3. Use electronic technologies as much as possible
Using the ATO-developed e-tax software has become an increasingly popular choice. Not only does it offer faster response times (typically around a fortnight), its options for auto-filling salary, bank and other data help minimise the odds of making a mistake. The 2010 version of E-Tax will be released on July 1. It’s a pity the ATO isn’t also sticking with its popular E-Record software, which is being dumped at the end of this financial year.
2. Know how long you need records for
Our guide from last year on which tax documents you need to keep and how long you need to keep them offers a pretty comprehensive overview on this topic (as well as some advice on when you do and don’t need receipts). The most important lesson? Electronic records are every bit as acceptable as paper ones, so with a little scanning you can drastically reduce the amount of clutter associated with the process.
1. Get your home office organised
Taking the time to properly streamline your office (or your home filing system) is the single most important step you can take to make tax less stressful. It’s much easier to fill out your return if you don’t have to spend hours hunting for missing receipts. And while having an orderly home office will make finding tax-related documents a breeze, it will also benefit your life in many other ways. Our recent ultimate guide to getting out from under if your office is out of control is replete with ideas on why offices get disorganised, and how to stop them being that way.
Got your own tax-time organising hints? Share them in the comments.
Lifehacker’s weekly Loaded column looks at better ways to manage (and stop worrying about) your money.