Login
iscover
The Tax Office has urged taxpayers to wait until the end of July to lodge their tax returns to minimise their risk of making mistakes.
Newsletter
Tax time 2020: ATO cautions early lodgers
17 June 2020
•
12 minute read
You’re out of free articles for this month
To continue reading the rest of this article, please log in.
Create free account to get unlimited news articles and more!
Accountants have begun bracing for a “horrendously busy” tax time this year as individual clients are expected to lodge early to get their hands on potential refunds as soon as possible.
However, ATO deputy commissioner Karen Foat has urged taxpayers to hold off from lodging until all their income details have been finalised.
“We often see people too eager to get a tax refund making obvious mistakes, which can either delay processing the tax return or result in a bill later on,” Ms Foat said.
With Single Touch Payroll now live for all businesses, apart from closely held payees, employers with 20 or more employees will have until 14 July 2020 to make a finalisation declaration, while employers with 19 or fewer employees will have until 31 July 2020.
The finalisation indicator will allow the ATO to prefill the employee’s income tax return and display the information as “tax ready”.
“It’s important to check that your employer has finalised the information in your income statement and it is marked as ‘tax ready’ before you lodge,” Ms Foat said.
==
==
“Other information from banks, health funds and government agencies will also be automatically inserted into your tax return. For most people, this will happen by the end of July.
“Lodging once we have included all of your information in your tax return makes it even easier, but if you are lodging before then, make sure the information provided is complete, accurate and up to date to avoid delays or a debt later on.”
Work-related hotspots for 2020
The ATO has also announced work-related expenses deductions that it will be paying close attention to this year, in light of COVID-19.
“With more people working from home, working reduced hours or unfortunately not working at all, we expect to see claims for laundry expenses or travel expenses decline this year,” Ms Foat said.
“If you aren’t travelling for work, you can’t claim travel expenses. If you aren’t wearing your work uniform, you can’t claim laundry expenses.
“It’s still important to meet the three golden rules: you must have spent the money and not have been reimbursed, it must relate directly to earning your income, and you must have a record to prove it.”
The Tax Office also expects to see a substantial increase in people claiming deductions for working from home as a result of COVID-19 restrictions.
A new shortcut method has been introduced by the ATO for taxpayers to calculate home office expenses at a rate of 80 cents per hour for the period between 1 March and 30 June 2020.
The new method is in addition to the existing fixed-rate method and actual-cost method, with taxpayers able to choose the appropriate method for their circumstances.
Claims before 1 March 2020 must be under the two previous approaches.
You are not authorised to post comments.
Comments will undergo moderation before they get published.