9 hours ago
How you could get $20,000 back in your tax
New data reveals nearly 30 per cent of Australians lose receipts and with tech, stationery and furniture all claimable come tax time this could cost them an estimated $20,000 over ten years.
The research from Officeworks revealed that while many Australians were eager to claim everything they could, the results showed tax time confusion remained.
Nearly half (47 per cent) mistakenly thought they could use the shortcut method and still claim individual working-from-home expenses.
More than 40 per cent wrongly believed they could claim up to $300 on their return without having made any actual purchases, while more than a third incorrectly assumed travel between home and work was tax-deductible.
Financial adviser and Pivot Wealth founder, Ben Nash, said these misconceptions could prove costly in the long run.
'One of the biggest mistakes people make is assuming they can claim things just because it's the end of financial year,' he said.
'You need to have actually incurred an additional expense, and it must relate directly to earning your income.'
Nash added that confusion and poor record-keeping saw many taxpayers miss out on valid claims.
'Nearly one in three (32 per cent) admit to missing deductions they were entitled to in previous years and general confusion or poor record keeping is leading people to forgo potential claims,' he said.
'That's real money left on the table.'
He advised people to take advantage of digital tools that made the process easier and if unsure to speak to a tax professional.
Last month the ATO revealed some of the wild work-related expense tax claims people have tried to put past the agency which included a truck driver who tried to claim swimwear because it was hot where they stopped in transit and they wanted to go for a swim.
Increasingly taxpayers are turning to AI tools like ChatGPT to navigate their confusion over what deductions they can and can't claim according to software firm Xero.
Managing director Angad Soin said seven per cent had used AI while five per cent used social media influencers.
He said more than half (51 per cent) admitted they were confused about deduction rules, particularly those relating to car, transport and travel expenses or working-from-home costs.
Almost one in five had previously tried to claim a deduction they weren't sure was actually eligible for.
'Half of those who made a specific tax deduction purchase last year found it didn't go positively, for reasons including they didn't get the return they expected (17 per cent), discovering their purchase was ineligible to claim (21 per cent), or they had to amend their return due to incorrect deduction claims (7 per cent),' he said.
ATO Assistant Commissioner Rob Thomson said exaggerated deduction attempts would not be tolerated.
'While a lunchtime dip might clear your head for work, swimwear for a truck driver is clearly not deductible,' he said.
'If your deductions don't pass the pub test, it's highly unlikely your claim would meet the ATO's strict you should be prepared to back it up, with records like a receipt or invoice.'
