If you use a registered tax agent, like Gotax, to do your tax return, you should be aware that their fees are tax deductible.
That means you'll get money back by claiming the fees as a tax deduction. The tax system specifically allows these costs to be tax deductible as Tax agent fees are part of the cost of managing your tax affairs.
The legislation goes beyond the mere deductibility of the tax fees alone and can also include:
Travel costs to see a tax adviser, (you can simply use the cents per kilometre method to calculate this)
Court fees and legal costs if you have to fight the ATO
Interest charges if you pay your taxes or penalties late (not the penalties themselves)
Software (Gotax) or books to help you do your tax return
It's easy to claim these costs, just remember to keep the receipt and if you're claiming travel, record the distance you have travelled to your tax agent. Now a point of confusion which many get caught out on. The fees paid (including the travel) are claimable in the year you incur the cost. That generally means the amounts you pay in the current year won't be deductible until the following year. Record the transaction so you don't forget. And the best way to do that is with the Gotax Deduction Grabber, a handy little app that records everything you need for your income tax return. Scan the QR code now..
What are tax agent fees? Tax agent fees are the fees that you pay to a registered tax agent (like Gotax) for doing your income tax return. A registered tax agent is someone approved by the Tax Practitioners Board.
Tax agent fees will vary depending on how complicated your tax return can be. And lets face it, their are thousands of pages of Income Tax Legislation designed to make it complicated. So shop around or google around to get a price that suits, or go to Gotax and find the best price around.
Using a tax agent can de-stress your life. Using a tax agent can make your life easier in many ways, such as:
Making sure that your tax return is right and complete
Getting you the most tax deductions and the least tax payable
Giving you tax advice on the best tax strategies for you
Keeping you up to date on the latest tax laws and changes
Assisting you if you have an audit or a problem with the ATO
How can you claim tax agent fees as a tax deduction?
Note again, it's important, you can claim the whole amount of the fees that you paid in the year that you spent them.
For example, if you paid $300 to a tax agent for doing your 2022–23 tax return, you can claim $300 as a deduction in your 2023–24 income tax return.
If you paid $300 to a tax agent for doing your 2021–22 tax return in July 2022, you can’t claim it as a deduction in your 2021–22 tax return. You have to wait until you do your 2022–23 tax return to claim it.
Tax agent fees are one of the costs of managing your tax affairs that are specifically tax deductible. By using a registered tax agent, you can get their help and advice on tax matters. But you have to keep track of your costs and claim them in the right year.
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