Tips to Avoid Getting Your Tax Return Audited

nicolemcmilllon on 31/07/2019 - 17:01
Last edited 01/08/2019 - 20:47 by 1 other user

Hi all, in the past few weeks we have seen an increased number of delayed returns, please explains and even audits this early into the tax season.

The problem is, even if you have a good and legal reason for what they are asking you, sometimes you get stuck with an unpleasant ATO employee who will dig deeper into other aspects of your return just to find something they can go at. Wanted to share few tips to avoid being contacted by the ATO.

Ill break them down into 3 different categories.

Category 1 - Not waiting for the information to be available

Here are a number of really simple reasons that you may be automatically flagged for an amended return/audit.

Not including all or incorrect amounts per your payment summaries (with STP try to ensure the income statement is finalised before lodging)
Not including all interest earned from all bank accounts/term deposits etc
Not including unfranked dividends or not waiting until trust annual tax statements have been issued to finalise your return.
Not including spouse income in your return to avoid medicare levy surcharges
Claiming personal superannuation contribution deductions without notifying the Fund of your intention to claim a deduction.

Category 2 - Things that may require a "please explain"

If your interest deduction for a rental property has been decreasing and is all of a sudden much more than prior years. This may result in a please explain to see if you redrew funds for personal reasons.

If you are claiming motor vehicle expenses in D1 and do not have a registered motor vehicle in your name, they may ask you to prove that you are the beneficial owner of the vehicle. For example that you have a private arrangement with the registered owner and that you pay all costs associated with owning the vehicle.

Category 3 - Most likely to get a full blown audit

Claiming significant donations, especially in proportion to your income. It is very cost effective for the ATO to pursue as they just have to ask for your donation receipts, its usually black or white on whether you have the receipts.
Claiming interest/dividend deductions and not actually having interest/dividend income.
Claiming significant education expenses. To claim courses, textbooks, stationary, the education being undertaken must have a connection to your current work activities and maintain the specific skills/knowledge equired in your current work activities.

That is all for now. Might update as the year goes on. Sorry for rambling.

Financial

Comments

  • spiff on 31/07/2019 - 17:05
    +47

    Very useful to know, thanks Nicole.

    • nicolemcmilllon on 31/07/2019 - 17:08
      +22

      Happy to help. Thank you for your kind words.

  • serpserpserp on 31/07/2019 - 17:10
    +20

    Here is a tip. Don't lie on your tax return.

    • nicolemcmilllon on 31/07/2019 - 17:13
      +49

      The tips I have given are about people making accidental mistakes/ not waiting for all of the information. They are to avoid flagging the interest of the ATO if you can avoid it. This is regardless of whether you have done the right thing.

      Going through an audit is arduous and takes forever. Also for some people it is frightening and they go through a lot of emotional stress.

    • HighAndDry on 31/07/2019 - 18:12

      The tax system is so byzantine it's basically a soviet-era joke…. though in trying to find the one I was thinking of I came across this (without finding the joke):

      https://en.wikipedia.org/wiki/Russian_political_jokes#Gulag

      Good jokes. People who advocate for communism should listen to what people who actually lived under it thought. They're basically consumer reviews.

      HighAndDry on 31/07/2019 - 18:12 (Collapsed - Offtopic. Show)
      • kahn on 31/07/2019 - 18:29
        +1

        You are confusing communism with authoritarianism.

        • HighAndDry on 31/07/2019 - 18:59
          -2

          Makes no difference when everyone makes the same mistake, including the people running things under communism.

      • GoldenDragon888 on 31/07/2019 - 18:30
        +1

        Reading about a man a Ukrainian man during 80s whose toilet cracked. It was going to take months to get fixed. He had a communist party connection in a town near the Mongolian border. He hopped on a plane for 17 hour trip and brought home a toilet sitting on it on the plane.

        A system that makes a man have to fly 17 hours one way to get a new toilet through back channel connections, then ride all the way back home sitting on top of that dunny — that’s not a system that works.

        • kahn on 31/07/2019 - 18:48
          +9

          It's very easy to cherry-pick such examples. We can also look at the current examples of American citizens going across the border to Mexico or Canada to buy affordable medicine. Does that mean the whole societal/economic system is broken or do you think it makes more sense to examine each issue in isolation? Corruption can fester in any system, but you could argue that some are more prone to corruption than others.

          • HighAndDry on 31/07/2019 - 18:59
            +4

            @kahn:

            It's very easy to cherry-pick such examples.

            https://en.wikipedia.org/wiki/Droughts_and_famines_in_Russia…

            Here's not cherry-picked examples. I could also tell you stories my grandparents told me about the "Great Leap Forward" in China too, but you'd think those are just anecdotes I'm sure.

          • GoldenDragon888 on 31/07/2019 - 19:00
            +2

            @kahn: You don’t have to whataboutism. The USSR was bad, American having it issues does not change that.

            • kahn on 31/07/2019 - 19:04
              +6

              @GoldenDragon888: The "whataboutism" is to elicit a response about the role that corruption, greed, and unethical behaviour can sour any economic system.

              • HighAndDry on 31/07/2019 - 19:07
                +1

                @kahn: Of course. But some systems account for this possibility and diffuse power, other systems don't.

                • kahn on 31/07/2019 - 19:14

                  @HighAndDry: Would you care to expand upon the method of diffusing abuses of power?

                  • HighAndDry on 31/07/2019 - 19:21
                    -4

                    @kahn: Democracy so that political power is distributed amongst everyone, and capitalism so that market power is distributed amongst everyone.

                    • kahn on 31/07/2019 - 19:26

                      @HighAndDry: We can certainly agree on the political aspect, but I hope you don't mean unfettered capitalism.

                      • HighAndDry on 31/07/2019 - 19:35

                        @kahn: Of course not. It's not "capitalism" that's the goal or the aim, it's a free market. A free market requires a level of regulation to keep it free, both from bad actors, and from inherently monopolistic forces.

                        Edit: In kind of the same way, a democracy is valuable because of free and fair elections, and not inherently in and of itself.

                        Though then we get into a definitional argument of whether a system of government that doesn't have free and fair elections could be called a democracy, and likewise whether an economic system without an actually free market would be capitalistic (as opposed to oligopolistic/etc).

                        • kahn on 31/07/2019 - 19:49
                          +2

                          @HighAndDry: Cool, but I'll just leave you with two thoughts.

                          1. We are eager to accept that political democracy is good, but we aren't so ready to accept it in the places we work.
                          2. The notion of a "free market" is a false one. A couple of of the main pillars/assumptions is that information is free and instantaneous, and that market participants act rationally. Both of these are demonstrably false. I like to think Ozbargain is a place where we try to minimise these falsehoods.
                          • HighAndDry on 31/07/2019 - 19:55
                            +1

                            @kahn:

                            We are eager to accept that political democracy is good, but we aren't so ready to accept it in the places we work.

                            Because those are two separate and different concepts. One is where/how you live. Privacy doesn't really exist in terms of politics, because it doesn't exist in terms of the law. Commit a crime in the privacy of your own home, and it's still a crime. Work is wholly different - it's limited in scope, it's far easier to change jobs than countries, and the aim of work is not for your gratification or entertainment or satisfaction, it's to produce results.

                            The notion of a "free market" is a false one. A couple of of the main pillars/assumptions is that information is free and instantaneous, and that market participants act rationally. Both of these are demonstrably false. I like to think Ozbargain is a place where we try to minimise these falsehoods.

                            Ironic considering the entire concept of "bargains" depends on businesses competing for consumers. Nothing is perfect, you're letting perfect be the enemy of "good". Information isn't perfectly free or available, but especially with the internet, it's certainly very readily available in 99% of cases. Market participants may not always act rationally, but again, you as an individual are certainly free to act rationally.

                            They're not false, they're just not 100% accurate. But even 80% accurate is better than the alternative - which, need I remind you - is literal widespread starvation.

                            What Churchill(?) said about democracy applies to capitalism too: It's not the best system, it's just the least bad out of all the ones we've tried.

                            • kahn on 31/07/2019 - 20:01

                              @HighAndDry:

                              the alternative…is literal widespread starvation

                              facepalm

                              • HighAndDry on 31/07/2019 - 20:02

                                @kahn: Hey, don't blame me. Blame history. What's that meme about how "reality has a liberal bias"?

                                History has an anti-communist bias.

                    • dtbnguyen on 31/07/2019 - 19:55

                      @HighAndDry: I challenge you to examine every claim that you come across in the media (from multiple viewpoints including foreign media) for one week and see whether you believe what you currently believe. It's a really cynical world out there.

                      https://en.wikipedia.org/wiki/Foreign_electoral_intervention
                      https://en.wikipedia.org/wiki/Confessions_of_an_Economic_Hit…

                      • HighAndDry on 31/07/2019 - 19:56

                        @dtbnguyen: Just because your opinions are counter-culture doesn't mean that everyone you disagree with must be blindly accepting mainstream news and ideas.

                        Stop and consider that people you disagree with are just as able as you to examine the facts and come to their own conclusions.

                        Edit: I'll end with this, since we'll undoubtedly just rehash the same arguments all over again if this continues:

                        I don't think capitalism is a perfect system, far from it. But in the same way that I don't even think democracy is the best system, the only better alternative I can think of is a benevolent dictatorship, however that's unsustainable because while power is self-preserving (and self-selecting), benevolence isn't. Likewise for capitalism. There are probably better alternatives. But not better ones that are inherently self-sustaining.

                        • dtbnguyen on 31/07/2019 - 20:04

                          @HighAndDry: How do you what my opinions are? The world isn't as polarised to one opinion as you think if you look across the board.

                          Fewer than 41% of Australian citizens are satisfied with the way democracy works in Australia, down from 86% in 2007. Public satisfaction has fallen particularly sharply since 2013, when 72% of Australian citizens were satisfied. Generation X is least satisfied (31%) and the Baby Boomers most satisfied (50%).
                          https://theconversation.com/australians-trust-in-politicians…

                          So we started by examining a troubling 2016 Harvard University survey that found that 51 percent of American youth aged 18 to 29 no longer support capitalism. Only 42 percent said they back it, while just 19 percent were willing to call themselves “capitalists.”
                          While it may be true that young people of any generation tend to have less support for incumbent economic and political systems and tend to change their views as they age, past polls on the topic suggest this is a new phenomenon felt especially by today’s youth. A 2010 Gallop poll showed that only 38 percent of young people had a negative view of capitalism – and that was right after the worst financial and economic crisis since the Great Depression, which hit young people especially hard.
                          https://theconversation.com/todays-youth-reject-capitalism-b…

                          https://www.pewresearch.org/topics/trust-in-government/
                          https://news.gallup.com/poll/1600/congress-public.aspx

                          • HighAndDry on 31/07/2019 - 20:22
                            +1

                            @dtbnguyen:

                            How do you what my opinions are?

                            Because contrary to your youthful naivete, genuinely new ideas are exceedingly rare, and you're more likely than not repeating an idea that's older than you are, that's been debunked for longer than you're alive. That applies just as much to me as it does to anyone else. I'm just old and jaded enough to be aware of it, and no longer go around with a permanent attitude of "look at this new idea that I've come across that no one else has thought of and that will solve all our problems", every time I read a pop-culture blog piece.

                            • dtbnguyen on 31/07/2019 - 20:35

                              @HighAndDry: You obviously have idea how much research when/I if across a single idea?

                              Most media analysts and experts in the media examine only a single part of history and in a single context. I examine how it functions often over thousands of years and in multiple geographical areas.

                              Alas, it's obvious my youthful zeal, experience, research, etc… is of no match for your own so I'll leave this forum to thee and to thine graces.

                              • HighAndDry on 31/07/2019 - 21:23
                                -1

                                @dtbnguyen:

                                You obviously have idea how much research when/I if across a single idea?

                                I obviously don't have any idea what you're talking about.

                                • elgrande on 31/07/2019 - 23:22
                                  +7

                                  @HighAndDry: For the record, including long debates on communism with your tax return will most likely flag it for an audit.

                                  • HighAndDry on 01/08/2019 - 09:44
                                    +1

                                    @elgrande:

                                    "Taxation is theft!"

                                    "Down with the bourgeois!"

                                    "You're just a tool of the Man!"

                                    • [Deactivated] on 01/08/2019 - 11:43
                                      +2

                                      @HighAndDry: That will flag you for being broke and have nothing taxable.

                                      I'm going to try that.

          • greatlamp on 01/08/2019 - 23:22

            @kahn: For communism to work requires a price ceiling, or price fixing.

            Basic economics tells us that a price ceiling will cause a shortage of goods - if you force people to make goods at a loss, they will make as little as possible

            Now you have scarcity, and human nature.

            People start to compete for resources- not based on wealth as you robbed all the rich people- but based on political power

            Suddenly you have a class system again, but based on political connections and corruption which abuses athe powerless masses - no different to unrestrained capitalism

            • kahn on 01/08/2019 - 23:49
              -1

              @greatlamp: Thanks for your comment, it's given me bad flashbacks to uni lectures :-(

              One thing I do remember was how much I hated economic assumptions like how one thing leads to another, leads to another, etc as if it's some sort of domino effect with no possibility of deviation. For example, price fixing doesn't have to be permanent, suppliers can make a loss up to a degree because they still need to generate revenue and utilise their supplies, equipment and labour, plus black markets could emerge. Meh, life is always more complicated than economic theories, but I do accept your point.

          • syousef on 02/08/2019 - 18:23

            @kahn:

            We can also look at the current examples(twitter.com) of American citizens going across the border to Mexico or Canada to buy affordable medicine. Does that mean the whole societal/economic system is broken

            Pretty much. Yes.

      • GoldenDragon888 on 31/07/2019 - 19:10
        +1

        I have always found Das Leben Der Anderen hard to watch being from the era when it looked impossible for the wall to fall without nuclear war between the US and USSR.
        But this is still a good joke. https://youtu.be/q8vDQaAYaQg

        • HighAndDry on 31/07/2019 - 19:50

          Gosh that was incredibly hard… just… well the Germans have a word for it but that feeling of waiting for the other shoe to drop - like a sustained cringe.

  • Heracles26 on 31/07/2019 - 17:12

    Pertaining to education expenses, what would be significant?
    I often claim about $1000 if not more per annum for conferences, accomodation etc

    • spiff on 31/07/2019 - 17:16
      +5

      Even though benchmarking would be done by the ATO, as long as you have the invoices to back up your expenditure the amount is irrelevant..

      • nicolemcmilllon on 31/07/2019 - 17:18
        +12

        That is correct, you can claim $100,000 if you have the invoices and are in the correct position to be able to claim the deduction. I am not trying to dissuade people from claiming what they are entitled to. However, if you were entitled to claim the $100,000 but also claimed $1,000 in another section of your tax return that you may have not been entitled to, the audit may cause that to be discovered.

    • nicolemcmilllon on 31/07/2019 - 17:16

      This sometimes comes down to the level of your income and the type of industry you are in.

      If you are a doctor/lawyer for example, there is reasonable expectation that the profession requires ongoing education.

      Just my opinion, $1,000 would not be excessive provided you are in an industry that would require the conferences etc and you were earning > $75k.

      • Heracles26 on 31/07/2019 - 17:46
        +1

        I am in health care and earn over $75k - some of the conferences I attend are nearly $2k!

        • [Deactivated] on 31/07/2019 - 18:37
          +1

          Some that I attend cost >$20k. Live patient hands on courses cost one to two buttloads.

          • Heracles26 on 31/07/2019 - 18:57
            +1

            @[Deactivated]: I wont complain ever again then haha

            • [Deactivated] on 31/07/2019 - 19:04
              +2

              @Heracles26: I don't complain either. I can understand the cost and see the value. Typically, we are paying for all hospital cost and material cost, the mentor is volunteering their time/conducting a study and we get I get my hand held through an invasive procedure.

              … and I typically get enough CPD points for the whole three year block in one go.

              Much better than Royal College fees. That's money for a whole lot of nothing.

          • kipps on 31/07/2019 - 20:19

            @[Deactivated]: Wow. What sort of procedures are done at live patient courses?

            • [Deactivated] on 31/07/2019 - 20:37

              @kipps: Look hard enough and you can find any.

              Some are dodgy AF (typically conducted in South American countries) but some are in semi developed countries.

              I remember looking at one for a hernia mesh… the same ones failing today.

          • spaceflight on 01/08/2019 - 18:05

            @[Deactivated]: Does your employer pay?

            • [Deactivated] on 01/08/2019 - 18:21
              +5

              @spaceflight: Yeah. Nice guy though. Very handsome.

              (Self employed)

              When I used to work for others I was given an education stipend. About $1k per year. Used to pick my courses based on $/CPD.

      • morse on 02/08/2019 - 20:48

        I think (but am not sure), doctors, nurse and allied health professionals that receive a CPD allowance as part of their pay packet could only claim education expenses in excess of their allowance. Most govt. employed health professionals would get a CPD allowance, definitely in QLD, not sure about other states. I wonder if the ATO would pick up on someone claiming a $1000 course when they also received at $2000 allowance for education, and didn't have other education expenses.

        • sillycattle on 02/08/2019 - 21:46
          +2

          I think they normally pay those things as part of PAYG income and tax it. Then you claim the deduction on your return. Covers situations you describe.

    • thatonethere on 31/07/2019 - 21:26

      When you claim educational expenses make sure you have an audit trail beyond the receipt to show it was paid from your taxable income.

      War story from this guy https://www.abc.net.au/news/2019-07-17/taxpayer-audited-by-a…

      Receipt not enough

      • spaceflight on 01/08/2019 - 18:06
        +2

        He also claimed incorrectly

        However, the ATO had two main problems with Jay's lodgement. The first was regarding the date of the claim.

        "When you go through HECS, you have two dates — the date incurred and date received," he said.

        "One is when you did the study and one is when you're liable for HECS debt.

        • greatlamp on 01/08/2019 - 23:26

          Courses paid for by HECS are not Eligible for tax deduction - they are already government subsidised

          Edit: nevermind, that wasn't the problem here. They are incorrect (surprise). That course isn't covered by HECS, they are talking about FEE HELP.
          Clearly someone who shouldn't be doing their own taxes

  • AlienC on 31/07/2019 - 18:24

    If you have some deductions/donations/interest even if minor small ones is it best just to pay a tax agent to do it for you than yourself?

    How good are tax agents do they cover everything and ask you all the stuff that is needed or do you have to be the proactive one and tell them what you need done because honestly I am the type to forget about stuff after doing it but if I told again then I can easily find it and give it to them to do all the necessary paperwork and lodging stuff.

    Thinking for the future when I might be having more work deductions/maybe some stock or crypro gains/etc honestly not that too sure about tax stuff.

    • Baysew on 31/07/2019 - 18:52
      +1

      The first $18,200 of your yearly income isn't taxed.

      • AlienC on 31/07/2019 - 19:17

        Are presents from birthdays or random gifts from people considered income?

        • Baysew on 31/07/2019 - 19:34
          +8

          Other amounts that are not taxable
          Generally, you don't have to declare:

          rewards or gifts received on special occasions, such as cash birthday presents and gifts from relatives given out of love (however, gifts may be taxable if you receive them as part of a business-like activity or in relation to your income-earning activities as an employee or contractor)
          prizes you won in ordinary lotteries, such as lotto draws and raffles
          prizes you won in game shows, unless you regularly receive appearance fees or game-show winnings
          child support and spouse maintenance payments you receive.

          Didn't expect the phrase "given out of love"!

          • josetann on 02/08/2019 - 11:39
            +6

            @Baysew: What about a gift that an in-law gave me out of spite? Is that taxable?

            • Baysew on 02/08/2019 - 12:01
              +12

              @josetann: Probably need to draw up an unappreciation schedule.

          • frewer on 03/08/2019 - 17:27

            @Baysew: What about 10 bitcoin that my brother who lived oversea gifted me ?

        • Blue Cat on 31/07/2019 - 19:34
          +1

          How would the ATO know?

          • AlienC on 31/07/2019 - 19:43

            @Blue Cat: Bank deposit or paypal friends and family payment.

            Trying to transform gift giving into the information age.. no need for these envelopes and cards lol when you can just send an e-gift these days.. I guess you could just get it in a form of a gift card but sometimes you lose money for the cost of the card that way and just promote more landfill options to the public.

            Trying to live a digital paperless/wasteless lifestyle where the waste I produce is less than my non digital lifestyle options.

            • Typical16-bitEnjoyer on 02/08/2019 - 10:52
              -2

              @AlienC:

              Bank deposit or paypal friends and family payment.

              In that situation the onus is on the ATO to prove it is taxable. Not on you to prove it's not.

              • gromit on 03/08/2019 - 09:34
                -1

                @Typical16-bitEnjoyer: That is NOT how the ATO operate. They can deem it taxable, the onus is then on you to prove it isn't. Burden of Proof is with the taxpayer not the ATO.

                • Typical16-bitEnjoyer on 03/08/2019 - 11:58
                  -1

                  @gromit: It is exactly how they operate.

                  They don't just randomly look at a bank deposit and "deem it taxable", they have a prescribed process they adhere to. The ATO would hit you with a Div 353 and find nothing. It would end there. Something minor like a bank deposit from a friend or family member gives them nothing to work with. Systematic recurring payments? Maybe. A single payment - nothing.

                  In the unlikely event Audit "deem it taxable" and hit you with an Audit position without any evidence it'll just be thrown out by the Objections team. The won't let a trivial matter like this run on as it'll just end up at AAT.

                  • gromit on 03/08/2019 - 13:42
                    -1

                    @Typical16-bitEnjoyer: I didn't claim they randomly pick transactions. I merely corrected your false statement that they need to prove it is taxable, they don't. If for whatever reason they believe it is taxable then it is until you prove otherwise. for the odd infrequent transaction this is a highly unlikely scenario to occur.

                    • Typical16-bitEnjoyer on 05/08/2019 - 08:28
                      -1

                      @gromit: I'm not sure you're actually familiar with the ATO's auditing processes.

                      If they hit you with an Audition position notice then you have several avenues available to you. Internally, AAT, heck even all the way to the FCA or FCC.

                      You think the ATO can just say whatever without legal justification? Lol.

                      Not sure the Federal Circuit Court would take kindly to the ATO saying "We're the ATO fam. Trust us. They have to prove Aunty May sending them $500 isn't a commercial enterprise, not us."

                      • gromit on 05/08/2019 - 17:35
                        -2

                        @Typical16-bitEnjoyer: Again I am not suggesting they are going to randomly pick a transaction or that you have no avenues of appeal. BUT AGAIN, the ATO is not an innocent until proven guilty process. You must challenge and/or prove your innocence if they believe they have reason to declare something as income. The onus of proof is foremost on you not them.

                        • Typical16-bitEnjoyer on 06/08/2019 - 08:56
                          -1

                          @gromit: It really isn't.

                          You object.

                          You challenge objections team.

                          You escalate to AAT.

                          You escalate to FCA or FCC.

                          It becomes just like every other Court matter. ATO will require proof.

                          If you're in the right and it's not income then how exactly will they prove it? They can't.

                          You obviously don't know the processes in place nor have you taken the time to even Google them and 'wing it'.

    • spaceflight on 01/08/2019 - 23:48

      How good are tax agents

      I had one tell me I couldn't claim workplace specific protective clothing.

      do they cover everything and ask you all the stuff that is needed or do you have to be the proactive one and tell them what you need done

      You need to tell them about your deductions.
      Unless you have your accountant with you all the time they won't know what you can claim.

  • altomic on 31/07/2019 - 18:30
    +11

    use a VPN whilst making a post on ozbargain about not having tax audited.

  • [Deactivated] on 31/07/2019 - 18:36

    Summary - don't deduct shit that does not exist. Don't deduct "gifts" and "donations".

  • djones145 on 31/07/2019 - 20:21
    +3

    tip on how not to get audited
    ~ dont claim any deductions or refunds
    ~ stay un employed
    ~ bikies

  • tassyk on 31/07/2019 - 20:51
    +1

    Would you recommend audit insurance? My accountant said treasury has given the ATO a billion dollars with a view of recouping 3-4 billion (suggesting higher rates of audits). Is he right?

    • nicolemcmilllon on 01/08/2019 - 09:38
      +1

      Might be talking about the Tax Avoidance Taskforce. They have a view of recouping 3.7b or something around that.

      Depending on your circumstances, and how difficult and time consuming an audit might be, you can look to get audit insurance.
      If you have been doing the right thing, generally it shouldn't take too many accountant hours, and the fee is deductible too.

  • Gelato on 31/07/2019 - 21:22

    Claiming significant education expenses

    i am a tad worried at this as I'm going to claim about $2.2k course fee/stationary (+laptop). I used to work at a bank but finished in May when i got hunted by another firm.
    Would ATO argue that my education expense was not related to my job?
    The course was a financial exam and it is still applicable in the job I'm doing now even though in another company

    Course fee around $1200, and stationary + laptop (declining in value) total less than $1000.

    • brad1-8tsi on 01/08/2019 - 08:30

      the deduction is related to the job you are doing, not the company you work for.

      eg: if Job A was in finance Job B was in finance and the exam / qualification was applicable to both jobs then claim the full cost.

      If the exam was only applicable to job A (job B is garbage collecting) then a pro-rata claim of 11/12ths of the cost might be more appropriate.

      For the numbers you are quoting, I wouldn't be worried.

      • Gelato on 01/08/2019 - 12:04

        Thanks for that! I do agree with your points.

        Cheers

    • spaceflight on 01/08/2019 - 18:10
      +3

      You can only claim the part of the laptop you used for work.

      If you use it 80% for personal use you can only deduct 20% of it

  • skid on 31/07/2019 - 22:31

    I think I fit into category 2. Thanks for the warning, Nicole.

    I am expecting a significant refund this year (mostly because of the above, withdrawing funds from an offset). How do I go about claiming interest from the ATO? How do I do the calculation and where do I put it in the return?

    • nicolemcmilllon on 01/08/2019 - 09:35
      +1

      Withdrawing from an offset account doesn't "taint" the loan, as the offset account is just your money that is offsetting any interest. When you remove funds from the offset, the loan is not affected.

      If you have withdrawn funds from the loan itself, you probably need to discuss with your accountant and tell them exactly what you have done and they can help set up a spreadsheet for you.

      • skid on 01/08/2019 - 09:43

        Thanks, Nicole.

        Let's say that I am getting a large refund this year: Can I claim interest (lost) from the ATO and if so, how do I calculate it and where do I put it in the return? I have been lodging PAYG installments every quarter whereas it could have been in my home loan offset (a different account from the IP offset).

      • GoldenDragon888 on 01/08/2019 - 11:15

        But in reference to the increased loan interest being charged when you withdraw a large amount of funds from said offset account. Wouldn’t the ATO just see the increase in interest being claimed as a tax deduction and question anyway?
        Or is their data matching smart enough to cross reference the loan vs compared to the offset account?

    • Westuff on 01/08/2019 - 14:37
      +1

      Are you planning on trying to charge the ATO interest ?

      • skid on 01/08/2019 - 21:29

        Hoping it would have gone along the lines of

        https://www.ato.gov.au/Rates/Interest-on-early-payments,-ove…

        • bluesky on 01/08/2019 - 22:02

          Somehow, the business gets this 'interest on overpayment for Income Tax'. But not the individual return - even though the same thing happens to both (i.e. overpaying via PAYG). Not sure if this is usually the case. The link you cite certainly says it applies to individuals as well.

          The rate is always not that favourable, and besides, you will have to declare and pay tax on it the next year anyway.

          • MITM on 03/08/2019 - 20:25
            +1

            @bluesky: Usually you would make a variation to the last quarter PAYG if you think you're overpaying or about to overpay.

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