Pandemic Leave Disaster Payments 1/7/2022-30/09/2022
Pandemic Leave Disaster Payments may be taxable if you received them between 1 July 2022 and 30 September 2022. When attending your tax appointment, ensure you have your Centrelink letter/s with you to provide the required information for your tax return.
There are three main rules when claiming tax deductions for work-related expenses:
- Only claim a deduction for money actually spent (and not reimbursed);
- The expense must directly relate to the earning of income you have received in the same financial year as the expense is incurred; and
- You must have a record to prove the expense.
Working from Home – You now need more records
From 1st April 2023, you must have a record of every hour worked from home in the form of timesheets, rosters, time-tracking apps, diary, or similar. You can no longer estimate your hours.
Claiming under the Fixed Rate method means you can claim 67 cents per hour and this covers the costs of energy, internet, mobile or home phone, stationery & consumables. You must keep at least one invoice of each of these types of expenses.
Claiming Motor Vehicle Expenses
If you are claiming motor vehicle expenses, take note of the following:
- New 4.20 cents per kilometre home charging electricity rate for full electric vehicles
- Ensure you have an up-to-date logbook (Full 12-week record of all klms traveled in the vehicle with commentary of the nature of each trip) prepared within the last 5 years. Note: if your car use has changed since your last logbook, you cannot rely on the logbook business % and must record a new logbook.
- Each year you must record the odometer readings at 1 July and 30 June
- Did you sell your car during the year? You will need details of the date and amount received. Note: if you received more than the ATO written down value you may have to pay tax on a recoupment of depreciation.
Bought or Sold Cryptocurrency?
The ATO is often aware if you have bought or sold cryptocurrency during the year due to data matching technology. If you have traded in cryptocurrency, this information is required to be considered for your tax return. When attending your tax appointment, ensure your provide information regarding these transactions.
You will need all supporting information for income and expenses relating to your investment properties. Remember to check your emails for your Agent’s Annual Summary and bring this to your tax appointment.
Repaired the property?
There are different classifications of repairs on rental properties such as initial repairs and wear and tear, and not all of these are immediately deductible in the year they are incurred. Please bring invoices and details of dates and nature of repairs to your tax appointment so that we can provide accurate advice to you on how to claim.
Refinanced your loan?
If you refinanced your loan on your rental property during the year, you likely incurred fees and other refinancing costs in the process. We can claim these over 5 years so make sure to provide these details to your Accountant.
It is important to consider the use of borrowed funds when calculating the interest that is deductible. Interest on monies borrowed for the rental property is deductible. If monies have been used from an investment loan for purposes other than the rental property (e.g. to improve a main residence, or to purchase a car), the interest on the loan will need to be apportioned to determine the amount that is deductible. Let your Accountant know if monies drawn from the loan have been used for personal reasons or other properties.
Renting Out a Holiday Home?
Expenses incurred on a property rented out as a holiday home may need to be adjusted for periods the property was used personally or made available to people for less than market value. Please provide a register of the number of days the property was used under these conditions so we can calculate the adjustment during your tax appointment.
Both employees and self-employed individuals can claim a tax deduction annually to a maximum of $27,500 for personal superannuation contributions, provided the superannuation fund has physically received the contribution by 30 June 2023. You are also required to submit a Notice of Intent to Claim to your superannuation fund and have this accepted and processed prior to lodging your tax return.
Catch-up Contributions to Superannuation
If your superannuation balance is below $500,000 as at 30 June of the previous financial year, you can contribute more to superannuation than the annual $27,500 deductible contribution cap where your contributions in prior years were below the concessional contribution cap. Employer contributions are counted for this purpose, and there are contribution and timing limits. Ask our team of knowledgeable accountants for whether you may be able to contribute more to your superannuation fund to utilise these available contribution caps.
Run a Small Business?
The immediate depreciation concessions for asset purchases are ending. From 1 July 2023, assets over $20,000 must spread the depreciation claim over several years. An asset must be not only purchased but also delivered and installed ready for use to be eligible to be claimed for depreciation. This is important to note if you are purchasing an asset in a given year and expecting a tax deduction in that same year.