The most important month of the financial year is here – tax time. June is the month to focus on maximizing your tax refund by considering additional work-related purchases, tweaking investments, income and expenses, and reviewing your super contributions.
The most important month of the financial year is here – tax time.
June is the month to focus on maximizing your tax refund by considering additional work-related purchases, tweaking investments, income and expenses and reviewing your super contributions.
The benefits of doing this can be seen just a month or so later in July/ August via a higher tax refund.
Have you upgraded your computer, monitors, ergonomic desk chairs (just ordered mine ladies…), printers or your mobile? these items can be claimed back in June.
If you’ve been working from home or operating on a hybrid – office/ home model, you should automatically have more tax deductions to claim.
Whether you navigate these with a tax agent, accountant or do it yourself, here’s how to claim your working from home expenses:
The ATO allows 3 ways to claim home office deductions:
1. The actual cost method, where all receipts and records need to be provided
2. A temporary 80c per hour ‘shortcut’ method, where a diary is kept of all hours worked from home
3. The 52c per hour fixed-rate method which covers running costs like electricity for lighting, heating and cooling, but also allows separate deductions for things such as phones and internet expenses, stationery, and depreciation of electronic equipment.
Tax specialists advise that people often get bigger deductions using the fixed rate option, but do some rough numbers to work out your own situation.
Option 2 –the 80c method ends this financial year, so it will be the last time you can use this simple short-cut method.
Paying extra money into super as a one-off tax deductible (known as concessional contribution) in June is an effective strategy for not only giving you a better tax outcome, but also for boosting your long-term retirement savings.
The concessional contribution limit for 2021/22 is $27,500 and includes any SG contributions paid into your super by your employer.
As women, often have lower superannuation balances, consider whether this is an appropriate strategy for you to boost your super.
For more tax tips, click on our blog from last year (the information is suitable to help with tax planning for 2022
https://www.womentalkingfinance.com.au/resources/tax-time-deductions-how-to-maximise-your-refund
https://www.womentalkingfinance.com.au/resources/did-you-know-your-handbag-may-be-tax-deductible
One important word to leave you with, "never let the tax tail wag the dog"
What I mean by this is don't go chasing tax deductions, any expenses or items you purchase, make sure they still have a value to you other than just the tax benefit.
Warmest,
As the year winds down, before setting ambitious New Year’s resolutions or 2025 financial goals, let’s take a moment to reflect. December is the perfect time to press pause, evaluate, and look back on the financial journey you’ve navigated over the past 12 months. Celebrating your wins, acknowledging your challenges, and learning from them can help you enter the new year with a stronger financial foundation. So, grab your coffee (or tea), a pen and paper, or your favourite money management app, and let’s take stock of 2024.
Read MoreYour current financial position is the result of many factors. But a major influence in your financial life is your psychological relationship with money. We call this your ‘money story’.
Read More
