If you earned an Australian income between 1 July 2019 and 30 June 2020, you will need to lodge a tax return. Even if your income is a lot less this year, it's worth lodging a return to see if you're due a refund.
If you're doing your own tax, you have until 31 October to lodge your return.
Lodge online for free with myTax
You can lodge your return using myTax, the ATO's free online tool. You need a myGov account linked to the ATO to lodge online. Returns lodged through myGov are usually processed within two weeks.
Lodging online with myTax is easy. Most information from employers, banks, government agencies and health funds will be pre-filled into your myTax by mid-August. You just have to check the information, enter any deductions you have, and submit. MyTax will then calculate your tax for you.
Declare all your income
Most of the information about your income will be pre-filled from details the ATO receives from your employer and financial institutions. There may be other income you need to add yourself.
Common types of income that must be declared includes:
- employment income
- government payments
- super pensions and annuities
- investment income (including interest, dividends, rent and capital gains)
- income from the sharing economy (for example Uber or Airbnb)
- compensation and insurance payments
Visit the ATO's website for more information on income you must declare.
Claim your tax deductions
You're entitled to claim deductions for some expenses. A deduction reduces your taxable income, and means you pay less tax.
To claim a deduction for work-related expenses:
- you must have spent the money yourself and not been reimbursed
- it must be directly related to earning your income
- you must have a record to prove you paid for it
When your expenses meet these criteria, here's a list of the things you may be able to claim.
Vehicle and travel expenses — If you use your car for work or work in different locations, then you may be able to claim a deduction. This does not normally include the cost of travel between work and home.
Clothing, laundry and dry-cleaning expenses — To claim the cost of a work uniform, it needs to be unique and distinctive. For example it contains your employer's logo, or is specific to your occupation, like chef's pants or coloured safety vests.
Self-education expenses — If the study relates to your current job, you can claim expenses like course fees, student union fees, textbooks, stationery, internet, home office expenses, professional journals and some travel.
Tools and other equipment — If you buy tools or equipment to help earn your income, you can claim a deduction for some or all of the cost. Examples include protective gear, including sunscreen, sunglasses and hats if you work outside.
The ATO have created occupation and industry guides to help you work out your work-related deductions.
You may be able to claim the cost of earning interest, dividends or other investment income.
- interest charged on money borrowed to invest
- investment property expenses
- investing magazines and subscriptions
- money you paid for investment advice
The ATO has more information about investment income deductions.
Home office expenses
Costs could include your computer, phone or other electronic devices and running costs such as an internet service. You can only claim the proportion of expenses that relate to work, not private use.
The ATO has introduced a shortcut to make it easier to claim deductions if you're working from home due to COVID-19.
Instead of calculating costs for specific running expenses, you can now claim a rate of 80 cents per hour for all your running expenses. This covers the period from 1 March to 30 June 2020.
Multiple people living in the same house can claim this new rate individually. You no longer need to have a dedicated work from home area in order to claim.
The ATO has more information about the other methods you can use to calculate working from home expenses during COVID-19.
Other items you can claim include:
- union fees
- the cost of managing your tax affairs
- income protection insurance (if it's not through super)
- personal super contributions
- gifts and donations to organisations that are endorsed by the ATO as deductible gift recipients
Keep receipts using myDeductions and make it easier to do your tax return. myDeductions allows you to record deductions including work-related expenses, gifts and donations, interest and dividends. It also lets you store photos of receipts and record car trips.
Get help from a registered tax agent
If you want to use a professional to do your tax return, make sure you use a registered tax agent. You can check if the accountant or agent is registered on the tax practitioner register.
Most registered agents have special lodgement schedules and can lodge returns for their clients later than the 31 October deadline.
Whichever way you choose to lodge your tax return, remember you are responsible for the claims you make. So make sure your deductions are legitimate and you include all your income before you or your agent lodges your return.