Lodging your personal income tax returns is generally a mandatory requirement for most Australian taxpayers, and a requirement that must be done every year with the Australian Taxation Office (ATO) on time and free of any errors or omissions to adequately show if you are owed a tax refund or you are liable to pay.
It’s understandable that lodging personal taxes can be a hassle and perhaps it’s something we may not exactly look forward to (unless you’re expecting a significant refund!). The entire process can be time-consuming and perhaps complex, especially if you’re doing it yourself and it’s your first time.
Fortunately, there are many ways to make the process simple and straightforward, letting you get back to spending your time on just about anything else you may find enjoyable or productive.
Lodging Your Tax Return
Your personal tax return tells the ATO a few key pieces of information about you and your economic activities, namely how much money you earn in income and whether or not you are eligible for (and claiming) any deductions to your taxes.
This information is used by the ATO to determine how much tax you need to pay on your income for the year, or, if you are eligible, how much you can expect to receive back. Moreover, the ATO will determine whether you’re paying too much or too little in taxes, if you need to pay Medicare levies, or if you’re eligible for tax offsets.
Tax returns work on the basis of fiscal years, so they don’t coincide with what you might call the new year, i.e. 1 January to 31 December. Instead, your tax return covers 1 July to 30 June of the year. Most personal tax returns must be lodged before 31 October of every year, except in some circumstances.
There are three main methods of lodging your tax returns:
- Doing it yourself with paper tax returns;
- Doing it yourself online with myTax (ATO);
- Using a registered tax agent to lodge on your behalf.
DIY Taxes vs Hiring a Registered Tax Agent
The ATO provides a wide range of resources to assist Australian tax residents with lodging tax returns, either alone via paper or using the online myTax portal, as well as information on how to claim various deductions and tax offsets.
While the ATO wants to make it so that everyone can lodge their taxes and remain compliant, doing so yourself can be a hassle. Even if you know how to lodge taxes yourself, it can be time-consuming and detract from your time which could otherwise be spent working or relaxing.
Instead, it’s often far more efficient and simple to allow a registered tax agent to lodge your personal taxes on your behalf.
Benefits of Hiring a Registered Tax Agent
If you choose to allow a registered tax agent to lodge your personal taxes on your behalf, you can free up a lot of time whilst remaining compliant with the ATO. There are other benefits, however.
Firstly, a registered tax agent specialises in Australian taxation and can provide you with many deductions and offsets that can significantly and legally lower your tax burden. Moreover, their expertise can eliminate any errors or omissions that could otherwise lead to audits. Lastly, registered tax agents usually have a later deadline in which they are required to lodge your returns by.
Badawy Large & Powers
Prepare your personal taxes with the assistance of Badawy Large & Powers.