With many people either out of work, facing job instability or working from home, and businesses tackling uncertainty, the only inevitability is that completing your tax return will be different this year.
We’re all wanting help and answers. Accountants and tax professionals will provide insights and critical viewpoints, so you receive the most for your situation and don’t get fined by the Australian Tax Office. They’ve also been busy helping their clients with the JobKeeper process and how to reinvigorate businesses.
The Federal Government’s JobKeeper wage subsidy and increased JobSeeker payment are both benefits and are taxable income. They must be reported like your normal salary. You’ll receive a payment summary of what you’ve been paid from Centrelink.
The lump-sum $1080 tax offset is available again this year. While all you have to do is lodge your tax return on time to receive it, not everyone will receive $1080. Worth between $255 and $1080, depending on your earnings, it’s a tax offset for reducing your overall tax bill, meaning your refund will be bigger than normal or your tax bill will be less.
There’s nothing for those earning over $126,000.
WORKING FROM HOME
With more people working from home full-time for several months, there will be an increase in home office expenses this year. To make deduction claims easier, the ATO has introduced three formats. Choose one and calculate your expenses from 1 March to 30 June. 1. The flat 80 cents per hour “shortcut” rate for all running expenses.
All you need is a record of hours worked from home. Other people working and living in the same house can also claim. Plus, a dedicated workspace is not required to claim. 2. The existing fixed-rate deduction of 52 cents. You must keep a four-week diary record of work hours spent working from home. The portions of work-related items that can be claimed are:
• Home office equipment. You can claim up to $300 or depreciation for items more than $300. This covers computers, printers, telephones, internet and furniture.
• Power bills for lighting, air-conditioning and heating.
• Repairs to home office furniture and equipment.
• Cleaning for your work area in your home.
• Office and computer consumables, stationery etc. and work-related magazines. 3. Actual expenses.
This includes the points listed in 2, but records must be kept showing the portion of your home used for work purposes and work times to determine the claim based on detailed analysis. This is the most demanding, and few people manage to maintain the meticulous details required.
Employees can also claim a flat $50 per year for phone and internet without detailed records. If your costs are more than this you need to keep a four-week diary of all work calls to gauge the percentage of all calls made.
The same process is used for internet usage and data downloads for work purposes. We hate to be a spoilsport, but unless you have a dedicated “place of business” room at home, such as a hairdresser, you can’t claim mortgage interest, rent, rates or land taxes especially if working from home is an interim measure like Covid-19.
Remember, you must have incurred the expense and not been reimbursed by your employer. The ATO is also expecting a decrease in work-related clothing and vehicle use claims.
PAPERLESS GROUP CERTIFICATES
The other change this year is the disappearing group certificate or payment summary. With organisations now reporting their workers’ income, superannuation and tax information directly to the ATO, your details will be on file for your tax agent or you can find them in your MyGov account. TQ