Well, okay... They aren’t that awesome – but they’re effective and will keep you out of trouble!
Before we get started on what records to keep for your tax returns and the best way to keep your records organised, let’s discuss why.
The ATO are always on the lookout for taxpayers who are overclaiming and simply taking the mickey out of the tax system. They have gotten better and better at this since they moved out of the old ages and discovered …TECHNOLOGY!
With their new high-tech wizardry skills, they are now able to look up data from taxpayers who are working in a similar occupation and earn a similar income to yours. From there, they can determine whether tax deductions are being overclaimed, which may then result in your tax return being flagged for manual investigation.
Now, you may work in a similar industry as another taxpayer, earn a similar income but have more expenses to claim – and that’s okay, you have a right to claim back everything you deserve! But, if the ATO start asking questions, you need to be able to prove that your claims are legitimate.
When you purchase anything work-related make sure you keep your receipts or invoices, purchases may include:
Uniforms & Protective Gear
Boots or Non-Slip shoes
Licences & Registrations (no… not your drivers’ licence)
Postage, Printing & Stationery
Union & Professional Memberships
Mobile Phone expenses (logbook may also be required)
Tools & Equipment
Work related travel
Super Awesome Tip #1 –Categorize your expenses using the above categories and total the expenses per category at the end of the year. E.g. 3 x $10 donations = $30 TOTAL
“Shoe Boxes are for Shoes” – anon.
Super Awesome Tip #2 - If you have a dozen receipts stuffed in a box or folder, there’s a high chance that they will fade over time. Create a folder in your email account called “TAX”, take a photo of your receipt, email it to yourself and save it in the “TAX” folder you created – and don’t forget your password
If you use your car for work – you need to keep records of the usage – we discuss what records you need to keep and other ways to keep track of those in Part Two.