TAX YEAR END – 30 JUNE 2020
Yesterday we gave you our Top 5 Superannuation Strategies that can help you to save tax and boost your overall financial position. Today in Part 2 we’re recommending that you review your potential tax-deductible expenses now, to maximise your claims.
TAX STRATEGIES PART 2: Review your Tax Deductible Expenses for 30 June 2020
Here are some of the common tax deductions you can claim, and what to look out for. The major issue for clients is that to receive a tax deduction, you must have spent the money before 30 June 2020, and show that you have made the payment for the expense.
| TAX ITEM | EXPLANATION | AAG TEAM |
| MOTOR VEHICLE EXPENSES | If your work-related travel is less than 5,000 km in the tax year, you can claim at a rate of 68 cents per kilometre. Note, you must be able to substantiate your claim (e.g. having records of travel for meetings etc.). If your work-related travel is more than 5,000 km, you can use the logbook method which allows you to claim the business portion of all running expenses (e.g. fuel, depreciation, interest etc.) provided the expenses have not been reimbursed by your employer. You must have a valid logbook to claim motor vehicle expenses using the logbook method. Make sure you keep your receipts for fuel, servicing, and insurance. | CLIENT SERVICES |
| TRAVEL EXPENSES | If you have travelled for work purposes and would like to claim the costs associated with the travel, ensure you have maintained a travel diary if you have travelled away from home for six or more nights in a row. If you are thinking to claim for travel to a rental property, please refer to this link to the ATO website to check your eligibility. | CLIENT SERVICES |
| DEDUCTIBLE DONATIONS | Make your donations to charities that have Deductible Gift Recipients (DGR). Ensure, wherever possible, that you get your receipt in the higher-earning spouse’s name. | CLIENT SERVICES |
| MOBILE PHONE AND INTERNET PLANS | Calculate out how much you use your mobile phone and the internet for work. | CLIENT SERVICES |
| LAUNDRY EXPENSES | Consider your laundry expenses, and check if you are eligible to make a claim. | CLIENT SERVICES |
| SUN PROTECTION EXPENSES | Ensure that you have purchased all applicable sun protection items before 30 June 2020 and keep your receipts. This includes sunglasses, long sleeve clothing, hats, and sunscreen. You need to link the sun protection expenses to your work and show the relationship to the income you earn, to be able to justify a claim. | CLIENT SERVICES |
| HOME OFFICE EXPENSES | Review and calculate the hours that you spend using your home office and how it relates to your job. | CLIENT SERVICES |
| COVID-19 WORK RELATED DEDUCTION FOR HOME OFFICE | With working from home increasing over the last few months, the following methods can be used to claim home office expenses
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CLIENT SERVICES |
| PREPAY INCOME PROTECTION INSURANCE PREMIUMS | Depending on your situation, you may want to consider pre-paying your Income Protection insurance. Income Protection insurance premiums are generally tax-deductible as they are protecting your income for the future. You may want to pay your premiums for your Income Protection insurance for 12 months in advance, so you can:
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INVESTMENTS |
Read AAG Tax Planning Strategies for Individuals for 30 June 2020 – Part 3
Please email us at consulting@austasiagroup.com if you have any queries. We will be in touch again in the new financial year to discuss your specific requirements for your tax return and to help you to maximise your claims. We look forward to assisting you with your tax returns.
