About 8.5 million Australians claim about $20 billion worth of expenses each year, says the Australian Taxation Office.
The average expense claim is about $3,000, and the average tax refund is not too far off that.
But the deadline to lodge your tax return for the last financial year is approaching fast. Here's what you need to do to avoid copping fines.
What is the tax deadline for 2021-22?
If you are lodging your tax return with the ATO yourself, the deadline is October 31.
If you're planning on getting a registered tax agent to lodge it for you, then you have a bit more time up your sleeve because they have a different lodgement schedule.
But you still need to contact a tax agent before the deadline closes on October 31 to arrange your tax return.
The ATO says you should contact them as soon as possible if you're having trouble lodging your claim.
What happens if I miss the tax deadline?
You can still lodge your tax return after the deadline, but the ATO may fine you.
The fine for failing to pay on time is $222, or one penalty unit, for every 28 days the return is overdue.
That continues for a maximum of five penalty units. This means it could end up costing you up to $1,110 if you fail to lodge a return.
What is the deadline to pay my tax bill?
Payment is due by November 21, even if you lodge your return after the October 31 deadline.
The ATO says it will apply interest to any amount you owe from November 21.
What's the go with getting money back? Or having a tax bill?
To put it very simply, if you pay more tax than you need to throughout the financial year, the ATO refunds the extra money you paid.
But if you don't pay enough tax, then the ATO sends you a tax bill.
How much will I get back from my tax return?
That's what you'll find out after lodging your return or hiring a registered tax agent.
But the average Australian tax refund is about $2,800.
You can read more about that and some useful things to do with any cash you get back here.
How do I know if I need to lodge a tax return?
If you're an Australian resident for tax purposes, you can claim the tax-free threshold for the first $18,200 of your yearly income.
The ATO says you need to lodge a tax return if:
- You had tax taken out of your pay in the last tax year
- Your taxable income was over the taxable threshold
- You're a foreign resident and earned $1 or more in Australia in the past tax year
- You are leaving Australia permanently or for more than one tax year
The ATO has a tool to help you work out whether you need to lodge a tax return, which you can check out here.
What's the ATO looking out for this year?
ATO Assistant Commissioner Tim Loh said the organisation planned to pay particular attention to a number of different expenses. Those include:
Travel expenses
Continuing to claim car and travel expenses at pre-pandemic levels.
"We're expecting that to go down quite significantly because if you've been working from home, you can't be in two places at once," Mr Loh said.
Claiming rapid antigen tests
Mr Loh says you need to satisfy a couple of rules to claim RATs as a tax deduction from when they were required earlier in the pandemic. They include:
- You spent the money yourself without being reimbursed by your employer
- The test must have been for work-related purposes, not for things like travel, for example
Cryptocurrency
Mr Loh says about 800,000 Australians have invested in crypto.
"When you sell, swap or exchange crypto there is a taxable transaction so you've got to make sure you keep good records," Mr Loh said.
