Australians face a $1,110 fine if they are late lodging their tax return with lockdowns creating extra challenges and confusion.
But they can also get $1,000 extra back on their tax return with one simple trick.
Individuals have until October 31 to lodge their tax return online if they are doing it themselves.
Failure to do so by this date means someone faces a $222 fine for each 28-day period beyond this deadline up to a maximum of $1,110.
Tax agents can lodge tax returns on your behalf by May 15, 2022 but taxpayers have to register with an accountant by October 31.
But with Sydney and Melbourne in lockdown, many individuals are confused about whether they can visit an accountant, with different rules in Australia’s most populated states.
Australians face a $1,110 fine if they are late lodging their tax return with lockdowns creating extra challenges. Individuals have until October 31 to lodge their tax return online if they are doing it themselves (pictured is a stock image)
H&R Block director of tax communications Mark Chapman said New South Wales was allowing tax agents to operate office premises, but not Victoria.
‘Accountants are categorised in the NSW Covid restrictions as business premises providing a professional service rather than retail premises, displaying and selling goods, so our offices are able to operate, with a comprehensive Covid safe plan,’ he told Daily Mail Australia.
‘However we encourage clients to utilise our phone appointments to do their tax return, for those that have the technology capability.
‘All our Victorian offices are currently closed. Instead, phone appointments are available.’
From March 2020 until the end of June 2021, the federal government allowed professionals to claim a flat 80 cents-an-hour rate for working from home.
But Mr Chapman said someone was likely to be better off opting for the lower 52 cents-an-hour rate and individually adding up their home phone, internet and electricity bills related to work.
‘The vast majority are using the 52 cent rate as opposed to the government’s 80 cent rate – many clients come into our office fully expecting to use the 80 cent rate but when we crunch the numbers, the 52 cent rate is generally preferred because of the additional claims for phone use, home internet and computer equipment depreciation,’ he said.
Mr Chapman said those working from home would typically lose out on more than $1,000 worth of tax deductions if they opted for the government’s flat 80 cent rate instead of the lower 52-cent rate with individual items manually added up.
Someone working from home stood to be able to claim between $2,550 and $2,700, an H&R Block analysis showed.
But with Sydney and Melbourne in lockdown, many individuals are confused about whether they can visit an accountant. H&R Block director of tax communications Mark Chapman said New South Wales was allowing tax agents to operate office premises, but Zoom appointments were possible too (pictured is Cabramatta in Sydney’s south-west)
By comparison, the same professional working from home who went with the flat 80 cents-an-hour rate would get just $1,536 for the 1,920 hours spent working from home during the past year.
While Sydney has been in lockdown since June 26, during the final days of the last financial year, Melbourne had already by that point been in five lockdowns.
With many professions in Australia’s biggest cities working from home for much of the 2020-21 financial year, the Australian Taxation Office is cracking down on work-related expenses.
That means dry cleaning and laundry expenses are on their radar along with car claims.
Mr Chapman said the tax office was particularly concerned with taxpayers claiming the maximum 72 cents per kilometre for car use up to 5,000km, even though they have been working from home.
In the May Budget, Treasurer Josh Frydenberg extended low and middle-income tax offsets of up to $1,080 for 10million people earning up to $126,000
‘The ATO is concerned that too many taxpayers are automatically claiming the 5,000km limit regardless of the actual amount of travel,’ he said.
Australians working from home because of the pandemic can’t legally claim deductions for home office use, like rent, council rates and mortgage interest, unless they have a business registered at their home.
Overtime meal claims are also harder to justify if someone is working from home during the lockdown and are eating what’s in their fridge.
Someone working from home could also claim up to $300 for new items like an office chair or a desk.
In the May Budget, Treasurer Josh Frydenberg extended low and middle-income tax offsets of up to $1,080 for 10million people earning up to $126,000.
This will see 4.6million Australians earning between $48,000 and $90,000 receive $1,080 as another 1.8million people earning $37,000 to $48,000 get back $255.
Those earning between $90,000 and $126,000 will get back a smaller amount.