2023 – the year of the low tax return

What a year it’s been already here in Australia hey? Price of everything through the roof (including things with roofs on them), cost of living skyrocketing and high interest rates causing no end of grief for homeowners and renters alike.

Luckily the tax return this year will save the day! Actually no, no it won’t. Everything is up in 2023 aside from your low tax return. What a wonderful sachet of salt to the already stinging wound!

Please note: I am not a tax agent nor a credible financial expert. When in doubt about a low tax return, or anything tax related it pays to talk to someone with experience in the field.

It’s that wonderful time of year

No not Christmas, please don’t mention the C word for at least another five months from now, thanks in advance. No I’m talking tax return time where you submit your group certificates, throw in your deductions and hope with the odd bonus, what you get back will either a) Buy something nice or b) Pay some bills. Hopefully a lot of bills. Because given the price hikes on electricity and gas, well a juicy fat tax return this year could go a long way in easing some of the stress there.

The trouble is that this year the bonus that was the Low and middle income earner tax offset is simply no more. Like driving a formula one car without a helmet, suddenly things aren’t looking so rosy, especially considering everything across the year piling up. And since we’re talking a tax offset of up to $1500 depending on your earnings, well that’s a lot of potential dolleredoos we’re now missing out on.
I know a lot of people (including myself) were counting on a decent sized return (I was hoping for a lot of decent returns for everyone so someone will finally buy my car..) but are now finding out (either in the news or when they do their return) that suddenly the cupboard of bonuses and offsets has gone the way of Old Mother Hubbard and is bare as bare can be. Which in turn means a low tax return, even after putting in all your deductions.

I’m probably not going to be buying one of these anytime soon.

A perfect example of a low tax return is my hardworking father in law who would usually net somewhere upwards of $1000+ in a return each year after deductions. And he’s always got that return ear marked for something, however in 2023 unless things change he’s looking at around $200 or so. Which after all that’s happened across the year, is more than a mite disappointing.
Another great example hails from Tik Tok where a worker from Bunnings shared her delight at her own low tax return.

Which in turn inspired my own expectations of a low tax return, based on everything I’ve seen and heard in the news this year.

Obvious the tax industry doesn’t have to give us these bonuses but after everything going up and families struggling to either put a roof over their heads or food on the table, you’d figure that maybe someone would look at the whole situation (someone outside of the RBA obviously who couldn’t see the plight of the country even if they tripped over it) and suggest that if there was ever a time this kind of offset was needed, now would probably be that time?

I guess not.

So what to do if you’re dreading a low tax return this year?

-First and foremost if you’re doing things yourself, make sure the paperwork put through or currently sitting in MyGov is actually ‘Tax ready.’ In my years of using MyGov this is the first I’ve seen this issue but depending on how early you’re doing your tax, your documents might not be tax ready (even though they’re there which is strange) and it’ll suggest you wait until the end of the month to finish your return. So unless you’re 100% confident that all is correct and above board, it’s suggested you wait until the tax ready status is applied. That means a far less chance of an incorrect return that may change either way later on.

-Make sure you know exactly what you can claim and what you can’t. Hope you kept those receipts.

But my best tip is: Get a professional to look at things, especially one that knows your industry (and what you can claim) well. Seriously, pay the money to find out if there’s anything you’re overlooking.

I’d done my own tax for years until one day someone I worked with recommended the accountants who worked a few floors up in the same building. And so I paid my $110 for the service and ended up with…well pretty much exactly what I’d get back if I did it myself. And from memory it wasn’t a hideously exciting return to begin with.

The first professional tax agent I ever used. I think he’s still figuring out my return to this day.

And so I went back to doing it myself for a time, becoming the unofficial MyGov support for the family who always had questions. Returns were usually average aside from the occasional low tax return. Flash forward to just a couple of years ago and I got another tax agent recommendation, only this time it was someone who’d worked with plenty of people in the media industry.

Which meant aside from being a bit more expensive, they had a far firmer idea of what I did, what I could claim and the things I was missing out for. And in turn that meant a far better return than I could of hoped for, so much show that even minus their fee, it was more tax back than I’d ever seen.

Someone who knows the talk and how you walk the walk when it comes tax time is truly worth their weight in gold. And if you’re not sure who that is, it’s time to talk to those you work with until you find someone who can pass the number on. Don’t google it, talk to the people around you first – someone will know someone and it could be the key to not having a low tax return this year or any year (still no guarantees but at least they can point out what you might be missing).*

*Plus you can write off the cost of a professional doing your tax in next years tax, bonus!

Can’t wait to see how bad things get next year!

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