Top 5 Tax Tips Overview
• Keep one bank account to record your income.
• Keep receipts to verify and substantiate your work-related expenses.
• If you hold CGT assets for more than 12 months and you make a profit on sale, only 50% is liable to tax.
• Make salary sacrifice contributions to your super fund to save paying tax.
• Read books like Tax for Australians For Dummies to broaden your tax knowledge.
If you earn income (such as salary and wages), you must lodge an annual income tax return for individuals disclosing the taxable income you derived during the financial year. So to comply with your statutory obligations, it’s best that you do the following:
• Credit all the income you derive from various sources to one bank account. This will help you to quickly calculate the amount of assessable income you derived during the financial year.
• Keep receipts to verify and substantiate all the work-related expenses you incur each year (such as, work-related reference books and journals, subscriptions to trade unions or other professional memberships and your tools of trade).
• If you hold assets (such as shares and real estate) for more than 12 months and you make a capital gain on sale, only 50% of the capital gain is liable to tax. But if you make a capital loss you can only offset it against a capital gain.
• If you make salary sacrifice contributions to your complying super fund you could save paying a substantial amount of tax and your retirement nest egg will increase.
• Because every financial transaction you enter into has a tax implication, it’s best that you have a basic understanding of income tax law. Reading books like Tax for Australians For Dummies (which is updated each year) can help you to quickly gain the necessary knowledge you need.