In the last few years I’ve got into a rhythm with my tax returns, knowing exactly what I can and can’t claim. But, this year is different. Due to the global pandemic, I’m one of the million Australians who are working from home instead of the office. And, according to Noteworthy, the learning hub from Officeworks’, there’s plenty I can claim this year which could make a big difference to my tax rebate. Small businesses are also in the money, with several new benefits that will make a big difference.
Here are some of the items Noteworthy tells me that small businesses and individuals can claim on:
1. Phone calls
If you haven’t been having Zoom meetings, are you even in lockdown? According to Noteworthy, for as long as I work at home I can claim the percentage of my phone bills and home internet that work isn’t reimbursing me for. Which makes those long meetings much more palatable.
2. Tax-free cash boosts
If you’re a small business, Noteworthy is great for tips you might not know about yet.
This year, the government is offering a support service to eligible small businesses by giving tax-free cash boosts equal to the amount of PAYG tax withheld from wages and salaries from March to June 2020. It’s delivered in instalments, with an additional boost when statements are lodged for June to September 2020. Payments are worth between $20,000 and $100,000 and delivered when you lodge your BAS – so there’s no excuse to delay doing it.
I recently took out income protection insurance, and much to my amazement, the Noteworthy article told me that this is potentially tax deductible - which definitely offsets my monthly premium. If you run your business from home – which many people are doing during the pandemic – you may also be able to deduct a portion of your home insurance premium. Every bit counts at the moment, right?
4. Deferral of payroll tax
If you’re a small business, you need to get on to Noteworthy for easy explanations of tax breaks this year. In NSW you can defer payroll tax until the end of the financial year; in Queensland you can get a refund of two months’ payroll tax, a three-month payroll tax holiday and a deferral of payroll tax for the 2020 calendar year; in the ACT small businesses on the ““prohibited activities list” from coronavirus get a one-off payroll tax waiver from April to September 2020; and in Victoria there’s a full refund and waiver of payroll tax for the 2019-2020 financial year for businesses with wages up to $3 million and a deferral of payroll tax for the first three months of the 2020-2021 financial year. More tax breaks apply in other states too. A quick read could save you a lot of money.
I’ve been cranking up the heating as I work from home in the last few weeks, and according to Noteworthy, this may be tax deductible. When you work or run a small business from home, you may be able to claim a portion of your heating and electricity costs. If eligible, there are three ways to claim these items; the ‘shortcut method’ allows you to claim a rate of 80c per hour, for every hour of work you do; the ‘fixed rate’ method lets you claim a deduction of 52c for each hour you work from home plus the work-related portion of your phone and internet costs; and the ‘actual cost’ method lets you claim a proportion of the actual cost – so if you think you are using 30 per cent more phone, heating and internet since working from home, that’s what you could claim
6. BAS due date
I didn’t know that the BAS due date and how often you file your BAS depends on the size of your company, with small businesses allowed to file less frequently. Noteworthy points out that understanding this information could save you in penalties and interest charges - and also save you a lot of time if you are filing more frequently than you need to.
I’d been considering joining my industry body for a while, but when I learnt through Noteworthy that fees from professional organisations that relate directly to your industry are generally tax deductible, it made the cost more affordable. Apparently, I can often also tax deduct any extra training or development I have undertaken in the past year, and small businesses may claim staff training, providing it meets government criteria. Noteworthy reminded me that if I saw an accountant last year to prepare and lodge my tax return, I can claim it. I rummaged around in my desk and found the receipt, so that will be one more deduction for me. I’ll remember to keep this year’s receipt too.
This is general information only and does not constitute taxation or legal advice. Other requirements under the tax law apply. Seek professional tax and/or legal advice to determine whether you are eligible to claim a deduction for any purchases.