• New Wave Accountants

Crucial Areas to Look Out for When You File Taxes in 2021

Since time immemorial, The Australian Taxation Office has looked into the tax returns of millions of Australian residents. However, this financial year is a little different from all the ones that have preceded it. This is because of the changes in ATO’s primary focus. These changes have brought about heightened scrutiny in a number of different areas, namely work-related expenses, rental cost deductions, and capital gains from various types of investments.


This update came from the ATO, along with the advice not to file and lodge their tax returns in early July. This tactic has long been known to be a useful “hack”, but the ATO has warned that many parts of the tax return may be accidentally forgotten in an attempt to get the task out of the way earlier.


If you are wondering how the updates of the ATO have affected how taxes are filed, this article will shed some light on this specific topic. Hopefully, after reading this blog post, you will walk away with more knowledge on the best way to get your tax returns in.


Crucial Areas to Look Out for When You File Taxes in 2021


Before anything else, it pays to fully understand what brought about the changes in the filing of taxes. When the shift from working in a traditional office setup to working from home was initiated because of the 2020 pandemic, there was also a shift in how files were scrutinized. If you fall under the work-from-home category or receive payments other than in the traditional way, your tax returns may find themselves under heavy scrutiny.


Here is a list of the crucial areas and work targets that the ATO may scrutinize more heavily.


1 - Rental Property Owner


If you have properties that you rent out, the ATO will be on the lookout for your tax return. Similar to how it has been for previous years, filing repair costs as deductibles is still not allowed.


2 - Gig Economy Workers


Electronic payments that come to you from your guests in your Airbnb rentals, or food delivery services, or other gig economy work will have an electronic receipt. These receipts will be verifiable by the ATO should they run a check.


3 - Remote Workers


Many people have shifted to the work-from-home setup to stay safe from the spread of the virus. However, many times, the mines for home and work expenses have been blurred because of this. The ATO wants WFH employees to avoid filing home expenses on their tax returns and passing them off as work expenses.


4 - Workers Who Get Paid in Cash


Receiving payments in cash may sometimes make it more complicated for the ATO to track. However, it does not mean that one may be able to get away with not declaring their true income in their tax return just because they got paid in cash. The ATO is quite resourceful and will be able to track undeclared payments, putting an offender on their permanent watchlist.


Conclusion


One particular reason why these changes were brought about is to prevent people from overpaying their taxes. Hundreds of dollars may be saved if you file your taxes correctly. Also, working with a reliable and experienced accountant will make a world of difference.


Work with the most skilled accountants on the Gold Coast! Unlike many Small Business Accountants on the Gold Coast, we provide end-to-end accounting and bookkeeping services that help scale and grow businesses. We understand small businesses and have worked with over 600+ businesses in several industries. This has allowed our Gold Coast Accountants to understand each industry and create tailored solutions for our clients. Contact New Wave Accounting today!



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