Nobody wants to pay more tax and with the habits of keeping records can save your money at the time paying tax.
As per (Australian Taxation Office) ATO’s update on work related expenses can be claimed as a tax deduction but for that you need to keep all your records. Keeping your records in an organised way throughout the year is a good habit which can be so much helpful to you at the time of tax return and make it much easier as well as if any claim is examined, so you can prove its authenticity.
But it’s not the end. A clear framework of your income and expenditures is the very first thing to pass, if you need any kind of financial assistance, buying a property or increase insurances. Making a good habit of record keeping is not only make your tax time stress free, it also very helpful to manage lot many areas of our life and keep it in right order.
So at the time of keeping records, what will you need to do?
The list is given below mention too many items and for most of the persons apply few things, so don’t be scared. However, we mention all kinds of tax deductable expenses so you can track all the records in future also as per your need.
First of all, you’ll keep all the records which are related to your income you received during the year are given below:
- Dividends
- Investments
- Salary/wages
- Allowances
- Rent from rental properties
- Income from letting a room
- Managed funds
Next step keeps all your deductible expenses where you can get boost up your tax return:
- Records of general expense
- Accounting Fees
- Income Protection Costs
- Charity
- Private health cover
- Records of general work related expense
- Certificate/ license fees
- Professional membership fees
- Union Fees
- Gifts
- Records of Education expense
- Course fees and textbooks
- Travel costs related to it
- Accommodation and meals when you need to stay out from home
- Libraries and Magazines related to work
- Records of lease or purchase of work related equipment
- Computer related consumables
- Computers and laptops
- Phone, mobile and phone accessories
- Calculators and electronic organisers
- Software
- Ipad& similar small electronic equipment
- Briefcases and carry-bags
- Sunglasses (if you work outside)
- Safety equipment – e.g. sunscreens, hard hats, harnesses, safety glasses
- Tools of your trade
- Technical instruments
Note:Purchases more than $300, you can’t claim it as a deduction for its purchase price, you can claim it as depreciation over a longer period in your next return.
- Travel records related to work
- Parking Fees
- Tolls
- General travel expenses, including taxi fares, flights etc.
- Public transport fares
- Accommodation and meals (if working overnight out from home)
- Home office expense records
- Office Furnishing Items, Desk Chairs
- Office related equipment
- All Stationary
- Postage
- Home Office related cost like Internet usage, electricity etc.
- Records related to maintenance and cloth purchasing
- Protective clothing
- Uniforms and logo
- Laundry costing of work uniform and protective clothing
- Records of all kind of expenses for your rental properties or other investments
- Records of disposed of/sold assets
- Records of expense related to any health issue or disability aids, aged care or attendant care
Now you understand what kind of records you should keep, but how long?
As per ATO’s suggestion you should keep your records up to 5 years.
For more detail visit ATO’s Blog: Keeping your Tax Records.
Now we describe “Must Do” record keeping habits given below
Get Prepared
Maintain all your tax deductable expense records or receipts in logical order means first newest to oldest. Otherwise, you will find yourself in the middle of the sea at the time of tax return.
Make a list
Create a list with all your expenses of every type. You have to remember the sum amount of every type of expenses so keep this kind of things on regular basis.
Back up all your receipts
Using technology is also helpful like scan your receipt or take a photograph of each record whenever you receive it, so with the help of this you have an electronic backup of each and every receipt which really easy to maintain.
Always keep data with proof
Never forget to get a receipt for an expense which can be claimed as a deduction because you can’t claim any single expense as a tax deduction which you can’t prove or no proof of purchase.
We describe all the nitty-gritty about keeping records but if you still need to know anything else related to this so you can contact PND Accountants in Melbourne. We will definitely help you to make it as simple as we can.
