Do I have to lodge a tax return?
Some individuals don't have to lodge a tax return it depends on your situation which can differ due to age, income and expenses. Your best option is to come in and have a chat with a Power2 Tax Consultant to get their view on whether or not you need to lodge a return. You can contact us here.
How long will my refund take?
At Power2, most tax returns are completed and then lodged with the tax office on the day you visit. The ATO, however, advises that once they have received the return it normally takes them 2 to 4 weeks to process it and prepare your refund. Last year the Australian Tax Office (ATO) was able to process almost 90% of returns within 10 working days. If you are having your Power2 fee taken out of the refund then this can also add a couple more days. If you get to 30 days and you still have not received your refund then please contact Power2 and we can look into it.
What if I am missing a payment summary from a job?
If you are missing one or more of your Payment Summaries your best option is to contact that employer to see if you can get another one. In the case your employer cannot supply a group certificate speak to Power2 and we will assist. By far the best solution is to always keep all payment summaries, even if you've only worked in a job for a couple of weeks.
Can I have the fee taken out of my refund?
In most cases fees can be taken from your refund. – Once the refund is released by the tax office your payment is deducted and the balance is forwarded to your bank account. Please be aware that there is an additional administration fee of $35 added to fee from refund returns..
Can I get more than 1 years tax returns done at the same time?
Power2 can prepare and lodge as many previous years returns as necessary. If you have several years tax returns to be done please let us know at the time of booking so we can allocate the correct amount of time for the returns.
What happens if I don't get my tax return lodged?
If you leave it too late and miss the deadline then you may receive a fine or interest penalty charge from the ATO. At Power2 we have lodgement extension facilities which can minimise these charges and, as a Power2 client, you will be benefit from this with extended dates to get your tax return completed.
When do employers legally have to issue PAYG Payment Summaries?
Generally employers are required to supply a payment summary within 14 days of the end of the financial year – i.e. 14 July. If an employee ceases employment part-way through the year, one must be supplied within 14 days of receiving a written request from the former employee and the request must not be made any later than 21 days before the end of the financial year. If a former employee has been receiving reportable fringe benefits (RFB) and leaves before the end of March then the 14 day limit may need to be extended.
How long do I have to keep my tax documents for?
You must keep all the records, receipts and other documentation you have used to prepare your tax return. If you are claiming deductions, you must keep written evidence to verify your claims for those deductions.
If you are an individual, you must keep proper records relating to your tax affairs for at least five years from the date you lodged your tax return. If you are a small business, you must keep proper records relating to your tax affairs for at least five years from when the business record is prepared or the transaction is completed, whichever occurs later.
If at the end of the five year period, you are involved in a dispute with the Commissioner (an audit, for example), the five year period is extended.
If you use information from your records in a later tax return, you may have to keep records for longer. So, if you carry forward a tax loss, you must keep the records until the end of any period of review for the income tax return in which the loss is fully deducted.
If you own an asset which will be subject to capital gains tax on disposal, you will need to keep records covering the entire period of ownership until 5 years after lodgement of the tax return recording the disposal of the asset.
I have shares and received franked dividends this year but have no other income. Do I have to lodge a tax return to get the franking credits refunded to me?
You do not have to lodge a full tax return. Power2 can complete the Refund of Franking Credits for Individuals form at a substantial discount to the price of a normal return.
Do I have to declare income from Centrelink (Newstart, Austudy) on my tax return?
All income must be declared. This is because the tax office needs to determine what tax rate applies to your other earnings for the year. You may be entitled to an offset to ensure that no tax is payable on your benefit.
You can access the information required from Centrelink online services, Express plus mobile apps and at self-service terminals at Dept. Human Services Service Centres. We can also look up the required information for you.
Is there a limit on how much I can claim as a tax deduction each year?
There is no limit on the amount claimed each year, provided the expenses are necessarily incurred in earning your income. The expenditure must be work related and you may need receipts to substantiate the expenditure. Power2 are happy to advise clients on appropriate record keeping that will enable them to maximise their allowable deductions.
Can I claim the fees paid to my tax agent?
Fees paid to a registered tax agent for preparation of your return, amendments and generally handling your tax matters are all deductible. Registered tax agents are the only people legally able to receive payment for the preparation of tax returns.
Am I entitled to claim $300 for work related expenses as this does not have to be substantiated?
You cannot just claim $300. You must actually incur any expense before it is claimable. Whilst, in some instances, you may not need receipts for expenditure up to $300 you must have spent the money and it must be relevant to your employment.
I have to buy tools and equipment for my job. What can I claim on my tax return?
You are able to claim expenditure incurred in replacing, insuring and repairing tools of trade that you use for earning your income. If the cost of any item is more than $300 then it will have to be depreciated (i.e. claimed over its effective life). The amount you can claim will depend on what records you have kept and to what extent you use it for income producing purposes.
I have started my own business - do I need to register for GST?
Australian businesses with an annual turnover of $75,000 or more are required to register for GST. However, if your estimated turnover is less than $75,000 there might still be some benefits in registering. Power2 can assist you with your application.
I run my own business and want to know how I can minimise my annual tax bill?
The secret to minimising your tax bill is not leaving your questions until after the end of the financial year. Speaking to a Power2 consultant before the end of the financial year and planning the year to come is the most effective way of saving tax..
Can you complete my tax return if I am missing a PAYG Payment Summary (group certificate)?
Your return can be completed using the details from a copy of the PAYG Payment Summary, a letter from your employer detailing the information on the PAYG Payment Summary or by reviewing your pay slips for that period. If you are unable to obtain the payment summary details from an employer a Statutory Declaration may need to be completed. Call us to see if we can access this information for you.
I received an additional PAYG Payment Summary (group certificate) after I completed last year's tax return. Can I put it in this year's return?
No, you cannot do that. A PAYG Payment Summary from a past year cannot be included with the current year tax return as the income on it was not earned in the current year. It can only be included in the return for the year to which it relates. You will need to submit an amendment to last year's tax return. Power2 can assist you to lodge an amendment.
I usually lodge my own return but will be unable to get it in to the tax office by October 31 this year. What can I do to avoid getting into trouble with the tax office?
If you owe tax and lodge your return late, any amount owing will be payable on 21 November this year and a general interest charge will be calculated from then until payment is made. The ATO may charge a penalty of $170 for every 28 days that the return is outstanding. Unless you use a registered tax agent, you have from 1 July until 31 October to lodge your return. If you need an extension of time either contact the ATO or Power2 for assistance on here.
I am leaving to travel overseas; do I need to complete my tax return before I leave?
It isn't necessary to complete a return before leaving Australia unless you will not be back before the due date for lodgement of your return (31 October). If you won't be back until after that date contact the Australian Taxation Office or a registered tax agent such as Power2 to apply for an extension of time to lodge.
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This list of FAQs is not exhaustive and will be updated on an ongoing basis - click back from time to time to get the latest updates.