5 Common Tax Return Mistakes

Whether you are an individual or a company, lodging your tax return accurately on time is important. However, there are some common mistakes that people make while filing their tax return which may result in audits from the ATO. The ATO automatically detects inaccurate tax returns. Hence it is better to understand the common mistakes and stay on top of things.

Mistake #1: Rental properties

This is one of the most common issues that ATO observes. Errors with rental property tax returns include private component, borrowing costs and claiming depreciation without a quantity surveyor’s report. Many taxpayers in Melbourne don’t realise what all they can claim, particularly land tax and strata levies. If you hire tax return agent in Melbourne, then you can ask them about the summary of income and expenses to make the return process easier.

Mistake #2: Math miscalculations

Math miscalculation is another common mistake of the tax return which occurs year after year. Errors in arithmetic figures need immediate correction. Failure to correct math errors can reduce or increase the amount of tax refund. Using a tax software programs can reduce math errors as these programs have built-in calculators that can do the work of addition, subtraction, etc. for you. However, you still have to make sure that the initial figures are correct. For example, if you enter $5400 instead of $4500, then all subsequent calculation will become inaccurate, and it can make a huge difference in your tax refund.

Mistake #3: Education tax refund

As per government statistics, there are over 400 000 parents who are eligible for the education tax refund, but they haven’t claimed for it. If you are eligible for Family Tax Benefit Part A, then you can get 50% back on certain education expenses for your school going kids.

Mistake #4: Not lodging

Everybody is busy in their personal and professional lives. Managing everything on your own may delay things. There are many people in Melbourne who not only delay the tax return filing, but they also have several returns outstanding. If you are paying tax, then make sure you lodge your return on time to get the refund and avoid late lodgment penalties.

Mistake #5: Doing it yourself

If you want to avoid above four mistakes, then it is better to hire a tax return accountants Melbourne. In fact, the fee that you will pay to the tax accountant is tax deductible. The tax accountants keep themselves updated with latest accounting and taxation rules. They are the experts who can help you avoid tax return errors.

Why Small Businesses Should Hire Tax Return Agent for their Tax Work

Most of the small businesses or sole traders in Australia prefer to manage their tax work themselves. Financially it makes sense as they need not pay any fee. One can do it in his/her own time rather than waiting for another person to do it and it also means that you don’t have to share your business’s information to an external person whom you don’t know or trust. Despite all these factors, hiring tax return agent in Melbourne is always a good idea. All you need is to find a reliable tax accountant who can take care of your tax work.

Reason #1: Accuracy

When it comes to DIY tax filing, mistakes can happen. Most sole traders and small business owners are not accountants. They might not be aware of the nitty-gritty details of accountancy and taxation, and hence, the accuracy and reliability are not guaranteed. As a result of it, mistakes are more likely to occur, and they may go unnoticed until the tax authorities audit all the financial transaction. In such a case, filing tax returns by yourself will be a time consuming, inaccurate and costly. By hiring a tax return agent in Melbourne or surrounding suburb, you can make tax returns less time-taking, accurate and reliable. Hence, it is worth outsourcing tax filing to a specialist if possible.

Reason #2: Complexity

Believe it or not, most of us know nothing about tax except the fact that we hate paying it. According to the Association of Chartered Accountants (ACCA), the tax system of Australia is considered to be the most complex in five developed economies. The complexity increases when you have shares, dividends, property, and it necessitates the hiring of a tax accountant who can deal with this complexity.

Reason #3: Deductible

The best part of hiring a tax return agent is the cost that you will pay to him/her for return is tax deductible. Isn’t this sound amazing? You don’t need to fork over any money to get professional advice.

Reason #4: Penalties

When you use a tax accountant or agent, you can get an extra duration of 5 months to file your tax return than filing it yourself. Mostly people are innately bad with deadlines. Late tax return filing can result in penalties. Hence, it is better to leave tax filing on professionals.

So these were some damn good reasons to consider hiring a tax return agent. A professional tax accountant will help you save money, time and efforts while maintaining the accuracy. If you are wondering- “where can I get a perfect tax return agent Melbourne for my business,” then simply click here.