Hello.
My name's Santasha Nabananga Bamblet. I'm a proud yr the Order,
Kernie Whoalbury and a waddery woman. And before we get started on She's on the Money podcast, I would like to acknowledge the traditional custodians of the land of which this podcast is recorded on a wondery country, acknowledging the elders, the ancestors and the next generation coming through as this podcast is about connecting, empowering, knowledge sharing and the storytelling of you to make a difference for today and lasting impact for tomorrow.
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She's on the Money, She's on the Money.
Hello, and welcome to She's on the Money, the podcast for millennials who want financial freedom. My name is Georgia King, and joining me as she does each and every Wednesday, is Victoria to Fine V.
How are we? I'm well, I just had one of those Listerine pocket pack fresh strips. When was the last time you had one of those?
So retro I think in primary school. Man has craven that fresh breath feeling.
I carry them everywhere I go And we were just talking and I was like, when's the last time you had one of these and you were like, absolutely never because they are outdated. But they're delicious, underrated, they're not delicious. But if you want fresh breath in an instant Listerine pocket pack, going to get your sponsor us. I reckon they should for a three dollar product. They pack a lot of much.
Not bad already, guys. The last financial year has been a difficult one for many, with significant changes in working conditions due to the ongoing pandemic, and with the end of financial year looming, many Australians are hoping for a bit of relief and wondering if this might come in the form of a bigger tax refund this year.
Oh very sexy. Today on the show Jojah King, I am going to take you through a number of things. Let's list them off. We are going to run through what you as an individual need to prepare for tax time. Very exciting. We're going to talk the tax offset. We're going to talk about what you can claim and what you can't claim. We're going to talk about what you need to look out for and where you can get
some more information. We're going to take you through everything you need to know when it comes to your investments. When you need to get an accountant, and we're obviously Jojia King also going to help you feel empowered about this process because it can be so overwhelming.
Absolutely it can. Before we go anywhere, Statskills entering the chat.
Hello, stats girl, welcome to the show.
Did you know Vikidi you probably did that around fourteen million people lodge a tax return each year in Australia.
I mean that makes sense. Thank you for that stat girl.
Of those who receive a refund, about two thirds on average, they receive just over four thousand dollars each. That's so much money, resulting in a collective refund of more than three billion. But some tax cuts have been in clemented for middle and low income earners over the course of the pandemic.
The perini, the pennine.
As you are really pushing, Aha, who gets it and how does it work?
The pannini the pannini. The panini is a thing. We're making it a thing.
I don't think it's caught on.
Justice only caught on with me and everybody I've said it too, is like you're a loser. Sit down. Yes, So the Australian government created this tax offset a few years ago to boost the incomes of low and middle
income Australians. The offset is still around this year, money Win, meaning that millions of eligible tax payers across the country are going to receive anywhere between two hundred and fifty five and one thousand and eighty dollars as an offset against their taxable income for this year, which is kind of helpful. I'm glad they've kept it around, especially after the past few years that were and then for many this will then flow into a larger tax refund that
they were probably already expecting. The offset amount really depends on how much you already earn. For example, you need to earn less than one hundred and twenty six thousand dollars to actually qualify for this, and you don't actually have to do anything in particular to receive it, just have to earn under that amount. It will automatically be calculated as part of your tax return when you do it. So Gee, the sooner the better when.
It comes to doing this, didn't know that was in place?
Money when?
What are some basic things I need to remember when it comes to doing my tax return.
That one, it is important to actually do your tax return if you've had your head in the sand for a few years and have heard this recently because people like Victoria it's just so hard, And now it's overwhelming because it's been five or six years and haven't done a tax refund, which actually does happen. It's okay. You can see an accountant, which is exactly what I would
recommend you do, and start getting that ball underway. You can still submit them, there's just a bit of a different process to follow, and the sooner you're on it, the sooner you're going to feel less anxious about that process, like, just get it done. Just get it done, and very likely it's not going to be nearly as overwhelming as you think it's going to be because you're probably going, oh my gosh, I'm going to be fined and I'm going to do this and I'm going to do that.
But the refund often ends up offsetting how much the penalties are, and if you've got a good accountant, they're often a able to be like, look, gee really didn't know what she was doing. Can we wipe this and have a conversation and just get an accountant on your team, because that's an anxiety you don't need to live with. Back onto. Actually what you need to do when it comes to your text return this year. Often getting your refund back is held up a bit because people are
making really basic mistakes. G it's not because the ATO are taking their time. A lot of this, as I've said before, in the POD is data fed and if the data isn't crystal clean and perfect, it needs to go through a manual process, and that's the manual process that takes a bit longer. So if your name or address has changed, make sure that you update your ATO
information before lodging a return. If you're lodging your return under different details, the ato's data matching technology isn't able to match it to your TFN, so if they can't match your tax file number, a manual person has to
get involved. And as you can imagine, when that happens at scale, as you said before, fourteen million people submitting their tax returns, even if just a small amount do it wrong, that's a very long list of people that need to get manually done, So don't put yourself in
that bucket. You need to make sure as well that your bank details are correct, So if you've changed banking products or changed banks recently, make sure you update those because all tax refunds now are done by direct deposit, meaning nobody at all ever is going to get a check in the mail from the ATO anymore. So making sure your bank details are correct is going to be important. You spell check Georgia King, It's very important if you see the little red squiggly lud kick it to my friend.
So if you've added an extra letter or accidentally spelt something wrong in a key field, it's going to delay your tax refund significantly because, as I said, manual matching process has to occur. And I promise those people are probably pretty pissed off that Georgia King had two a's on her name and they just had to backspace it, and that was the entirely of their job to do
it right the first time. My friend, Then what I want you to do, g is also make sure you're adding in all of your income, all of your shifts from Uber that you did last October, for that one time that you thought you were actually going to do that, that shifted a cafe where you were like, oh, I'm going to pick up this Sunday job, and then you realize you didn't want to do that anymore and now you just have a full time job. We can't forget about these things because this is where you're going to
run into trouble. You do have to pay tax on those jobs, even if they were really fleeting. So not claiming income is something that the ATO has been coming down on really really hard recently on especially with the rise of the gig economy. They're trying to be far more on top of it because they're like, well, we need to really capture all of these income streams that people are, you know, going out and earning and making
sure that we're taxing them appropriately. So just do the right thing, not because I'm trying to tell you to avoid tax or not. I'm literally just doing it because it's going to take longer if you submit your tax return and ge some random cafe out in woop woop has your details because you worked one Sunday shift one time and you didn't claim it. Yeah, exactly, because everything is data match to these days, like somewhere somehow there
it's going to be a record of that. Just make sure it is on your actual tax return.
So would you say, maybe keep a little spreadsheet with the little in.
The journey out keeping a spreadsheet, so absolutely if that's down your alley. But also the other thing is probably don't try and be too fast to do your tax refund. I think a lot of people really go, oh my god, it's June thirty. I need to get my tax refund asap. And I totally get it if you need the cash, totally. But businesses actually have up until June thirty as like that cut off date for reporting on their finances. It's then going to take me a little bit to get
your group certificate together, ge. And this happens in my business as well. So I'm going to sit down this year with my accountant and I'm going to go, okay, cool, it's tax time end of June thirty. I need to get all of my team their group certificates so they can submit their tax I need to upload everything to the ATO and get it all done. As an employer, that doesn't just happen on June thirty, because June thirty
is the last reporting day of all those finances. Like what if you took annual leave on June thirty, or what if you actually, you know, had some sick leave balances or whatever. I need to work out I need to do that for my whole team. So usually my team get their group certificates, like at the end of the first week of July, because I just need a little bit of time to get my stuff together. It's not just me who does that though. The bigger the business,
the more that can take. And it's very common to not get your group certificate until late mid July or even late July. I'm not saying it's appropriate. We want it asap, but understand the process. It's not going to be in your inbox on June thirty to submit it asap.
Just back to the gig economy as well. We did do an episode a couple of weeks ago on tax and side hustles. So if you have a qual to that, Lind, so that you would have the resources you needed by the time tax time came. All around tax times, it's likely having a spreadsheeler gee, you know.
G Another thing to keep in mind is being proactive about tax time instead of reactive. That's such good information coming from somebody who's always reactive instead of proactive. So cute from me. But once June thirty has come and gone, by the way, that's my birthday so if you don't say happy birthday to me, I'll be kind of salty. You need to wait another twelve months before you can
claim it spence on tax. So if you're looking at purchasing something for your business or something that you're actually able to claim kind of now is the time to shine my love, like, go and organize that now instead of after June thirty, because if you do it after June thirty, you have to wait a whole other twelve months to claim it. In saying that, can we please stop justifying June thirty purchases as small business owners like you do not just need a new laptop because you
think you'll get a tax refund. You still have to pay for the laptop, like that's still coming out of your business cash flow. So I think we need to be a lead to a bit smarter about it, because my new iPhone is telling me to tell you that.
Okay, while we're on the topic of claims fee, what are your tips on making the most not doing a dodgy?
Not doing a dodgy? Yeah, just don't claim things you can't claim fair enough. Don't claim things you didn't spend money on. Stop with this idea like this, This grinds my gears right, So it wasn't in our Facebook group because our Facebook group is full of very smart, very intelligent people who do the right thing. This is other Facebook group that I mean, and people like, oh, don't forget you can claim up to x amount without receipts. Yeah you can, but you still have to spend that money. Yeah,
Like that is so dodgy, it's not funny. And the ATO is coming down on that. They're gonna go, g you're a podcaster, what do you mean you spent fifty dollars on sunscreen? Like, that's not related to your job. They'll ask you for the receipts, and they are getting better and better at asking for receipts because as data matching gets more intelligent, AI starts to come into it. They just like pop it up and send an automatic email to you to be like, hey, ge, you claimed this,
Please provide with the receipts. You're gonna end up with a penalty if you're claiming things that you weren't meant to claim. Just do the right thing. Stop trying to be a stinge, like, oh, let's move on.
So our advice is not to put mayo on our claims what.
Happened unless you're actually paid for that mayo and it was related to your job, in which case you are more than welcome to claim it, claiming things that you're not eligible for just because you want a bigger refund, because that ain't insists what happens. If we get audited, you'll get in trouble. So don't embellish is the number one rule. But obviously, as I said before, super common misconception that you can quote claim up to three hundred
dollars without receipts like that is not it. People who are lodging their own tax returns using the atos MY tax software are monitored by the atos AI software as they prepare their returns to make sure that people aren't overclaiming and doing the wrong thing, like they actually track it. It's kind of scary, but at the same time it
makes sense. And they also have these buckets, right, so the way that it works and this is just like a kind of like the way it works in the back end, in the technical way, I'm calling them buckets, but like let's say you're an executive assistant. They're going to have a group of people that they will compare you to that are also executive assistants, and there will
be common claims and then there'll be uncommon claims. So if there are uncommon claims coming through, that's going to raise a red flag and you're more likely to be audited. It's really important to get your job classification correct as well, because it could put your risk of being audited or not, or actually getting in trouble or not. So the best
thing to do is actually just the right thing. So if you're then found to let's say you have claimed something that you weren't entitled to, it doesn't just mean you have to repay what you claimed back and you just got caught out. You're actually then paying an interest rate of nine percent perannum as well on top of that as well, So you've got your nine percent. You
have to pay your stuff back. But if the ATO then also believes that you are being super careless and maybe a little bit naughty and doing it on purpose, they'll then slap you with a penalty of anywhere between twenty five and ninety five percent Georgia King of the tax avoided. Right, that's not worth it.
It's not worth it.
Not worth it, friend, don't do it. So the easiest way to keep track of your spending from my perspective, one the ATO app is really helpful because you can keep track of things that you're going to claim throughout the year, can snap a quick picture and upload it. If you're anything like me, you don't want to have to have that app, even though it works really well and it makes a lot of sense, just trying to put another like step in the process for no good reason.
You have an album on your phone where you just snap away at things and then when tax come comes you actually just go into that album and have a look. And then obviously keeping a budget's a good idea. Always just stick to it.
I did the old album trick.
Did it work?
I have one receipt in there, but at least you set it up. I know my intention was good.
The intention is always good. But I do that as a business owner because there's so many different things that go different places. It's so frustrating as well. Like you know, I could go on about this, but we only have one debit card for she's on the money the business, So sometimes I like pay for things in my personal name because Jess's got the card from work or something, and then I need to claim it. It's just it's
a little bit confusing a headache. It could be much easier if I just listened to my accountant properly, But who's gonna do that? That's so silly.
Do you know how much of your data is pre filled on your tax return? Set and forget out?
It's not all set and forget It really depends on one if you've done it before, and then how much personal and financial information you've given to employers or to the ATO. But essentially, when you log into the ato's tax system, often a lot of your information is already there, and you'll be like, where did they get that from? And it's usually either from your previous employers, from your current employer, or from you having done tax returns in
the past, which is kind of cool. It's actually really helpful when it comes to prefill because it means that you don't have to do it over and over again. And if you've done this a few times, it kind of becomes like second ag. You just log in, check all your details and make sure everything's correct. Was that my income this year? Yes? It was? Was there anything I needed to claim? Yes?
Or no?
Or Hey, here's this petrol that I did xyz on how much did my investments make this year? Pop that into the boxes. Like, it's actually much simpler than people seem to think it is. I think we think back to like two thousand and nine when you definitely weren't doing your own tax, but I was George, and it was a lot more complicated than it is today. Okay, I don't know, have a look, give it a go and have to submit it if you're overwhelmed.
Do we want to go to a little right here, my girl, I would love to go to a break because tax is boring. But on the other side, guys, we'll be getting into the juicy stuff talking about what we can actually claim.
Some people can claim dogs on tax, not me though, a right, we'll talk about it after all.
Right, we are back talking tax victoria.
Oh my gosh, what a dream.
Let's jump straight into what we can actually claim. You mentioned before we can claim dogs or someone.
Look, someone can someway someone has claimed a dog. But you can claim a dog if a dog is actually part of your work. So like mainly obviously people in farming or security, they could claim their dog is related expenses we should come into security. Would be a good guard dog.
Absolutely, anyway, tell me what else we can claim.
Look, there are lots of things that you can claim. Again, please don't take this as a list of things that Victoria is suggesting you claim on it's not. It's just educational. We're just talking about tax trying to make it a little bit less dry than it actually is. But one of the things that I can claim it's my handbag, Georgia King, what what I can claim it? Stick your laptop in it. Yeah, it's a work bag. It can't be a fancy designer bag though, because the ato are
going to have some buckleis with that. They're not gonna like that. It does actually have to be practical and reasonable in nature. So you can't just go buy like a Chanelle boy bag and be like, it's my work bag. It's actually to carry your work things to and from work. If you carry a laptop. You can claim shoes. We love shoes. We love shoes, except you can only claim shoes if you're like a flight engine. So it's not as good as what you would think, like a good
pair of Jimmy shoes ain't gonna happen. This year for me or my tax return. If you work outside, you can actually claim makeup that has SPF in it. Kind of cool, right wow. And SPF related products because obviously if you are in the no you know you should be wearing SBF. But also if you outside you get a little cheeky tax deduction on it because it's for your health. Cute charity donations. Anything over two dollars you can claim, so keep track of those. The interest you
earn from your investment income. That's very sexy. Sex toys, Georgia, you were looking a little bit dry. Are all the things that I was running through. So I'm just going to throw that one in there.
Yep.
If you work in the adult entertainment industry, AA too have a special guide about what you can claim. If you're an adult industry worker, interesting claim things like dance lessons or haircare or oils or tissues or lingerie or costumes up to you. Kind of cool that you can do that. Another one garden gnomes? Do you want to claim your garden nomes? This obviously is its own dot
point in itself. Like this has made it as a line item in our spreadsheet for this planning episode, but landlord's very able to claim garden gnomes because obviously it is a property related expense.
That is incredible. Wait, what's the deal with gardenomes? Are they I'm not get rid of snails or something.
I have no idea that a guard like a little scared. Do you know? There's this house that I walk past every single morning, And if you live near me and you've seen me walking in the morning, you know this house. You know what I'm talking about. You walk past it, it's got like a low picket fence, and then you look into the garden and the entire front garden is like full of garden gnomes. It's not that weird about that, so strange, And this house also has like gargoyles on
the top of it. It's kind of creepy. But the creepiest part about this is all of these garden homes have quite clearly been very dodgily hand painted, so like it's.
Low pe creepy.
Joy.
No, but maybe they're just really smart when it comes to tax stiff.
If that is your house, I'm so sorry. I'm so sorry. But then obviously there are some smart things that you can claim. So if you've been working from home over the last few years. You can claim your home internet and any of those working from home expenses. Have a look on the ATO website. There is an entire guide for working from home and claiming what you can claim.
So two ways of going about it. You can either claim a set amount or a CeNSE per dollar, and I think you need to do the calculations on which one works out better for you instead of just looking at that big shiny set amount dollar and going let's do that. So definitely have a look into that. You can obviously also claim financial planning expenses and your accounting fees and stuff like that, but there's an entire list.
There is a blog on our website that I wrote a couple of years ago about what you can and can't claim, so I would be checking that out.
George King, You've also got subscriptions to work related magazines and journals if you work in the media.
Yep, so like you can claim Vogue. Yes, thanks, I'm gonna go sign up for that asap. This is great.
Before we move on, b when we say claim is a percentage of the cost of whatever we bought and are claiming or paid for.
No, it's not going to ever be the whole thing, it would be the tax component of that. So if your marginal tax rate is thirty two cents in the dollar, that is what you're claiming. You're not claiming like, oh my god, I spend a dollar, I get the whole dollar back it's free. Like that's not how t works. Perfect. Sorry, I'm sorry. Good to know.
So V do we need to pay tax if we receive gifts as payment? I'm talking about influencers specifically.
It's such a thing to bring up as somebody who does have a lot of clients who work in that social media sphere and earn a lot of money but also get a lot of gifts. Yes, they are actually taxable, and I have actually spent I think I mentioned this on the podcast last year. I have been going back and forth with our lawyers to work out how this works because it's such a new space that the ATO
hasn't come out and directly said this is taxable. This is not because obviously, gee, if I turned around and said, hey, gee, here's a Listerine pocket pack of fresh breath strips, you are welcome. That's like a genuine gift. But if an influencer given that with the intention of posting about it and generating incomes that is actually then taxable. So it's
quite confusing. And a couple of years ago I had a client who ended up in a bit of a pickle because they had been gifted this gorgeous, bougie overseas holiday. It was to a very big theme park in the US, and that would be so fancy, you go, gee, do you want to go to the theme park for free? But tax time came. The ater knocked on their door and said, hey, we saw you did your tax but we didn't see that trip that we saw on your Instagram.
Could you let us know how much it was worth because you have to pay the tax component of that.
It's insane.
Yes, So it is very complex when it comes to gifts. If your parents want to give you money and stuff like that, let's strip it back to non influencer life. No, gift money doesn't form part of your accessible income, so you don't have to declare it. Regardless of the amount, whether it was a dollar or five million dollars, you don't have to do that. However, if it is something that was used to generate income, that is where tax does come into it, and that's where influencers actually need
to be kind of careful. Obviously this is very niche content, but even if you're a baby content creator, like you need to be making sure that if you're agreeing for a sponsorship with a company or a paid collaboration, if they're just gifting you products, they need to take care of the tax component of that, because it shouldn't be on you to like take their product, post about it and then at tax time have to pay. Like that's a lot.
The other thing as well to remember, guys, is that we do need to be paying tax on our investments, and we did a whole episode on that. Listen back to our Reporting season ep if you haven't already any.
Years of episodes. June is always so dense when it comes to content. Sorry not sorry, Let's have some like fluffy July episodes for them. We'll plan those later.
Absolutely absolutely, all right, V When is the right time to put our tax in the hands of the professionals versus just doing it ourselves.
When you feel comfortable to do so. I think there is a very good reason why more than seventy five percent of Australians actually use a tax agent to do their tax returns. And that's because tax is arguably not very sick. If you don't know exactly what you can claim, you actually might be missing out on some sweet returns, and if you do get it wrong, you could be in for some pretty hefty fines. So from my perspective, it does pay to talk to somebody who knows what
they're talking about when it comes to tax. It's also just really important to feel empowered through that process. I know it can be expensive, but don't forget that. You know, if you're paying somebody two hundred and fifty dollars to do your tax return, that two hundred and fifty dollars next year can be claimed, So it's not as big of a cost as you might think it is. But also usually an accountant's probably going to be able to find two hundred and fifty dollars worth of claims for
you that you probably weren't able to find yourself. If I'm beased for itself, yeah, like hopefully. And basically the only way to get definitive tax return advice is from a registered professional, Like you can't just jump on the ATAR website and read all their blog articles and be like yep, cool, I read that, guys. That's why I claimed it like a tax professional is going to actually be able to put you in the best possible position.
Before we head v Was there anything else we should keep in mind?
Yes, my friend, so you know how he said. Obviously June thirty, you can't lodge it on the day if you don't have your group certificates. Is actually a date that you need to be aware of, and that is the thirty first of October. You need to lodge your tax returns before then. You might be able to be eligible for an extension beyond that date if you are registered with a tax accountant by the thirty first of October.
But if you aren't registered and you haven't done your tax you might be up for some penalties, which is not very good. I would factor in about two weeks for your tax return to come through. And the other thing is don't pester to your tax accountant when it's actually gone through. They can't tell you the progress. There's no progress updating, there's no like logging into the ATO portal to see status like it will just be done
when it's done. So I'm just quick shout out for all the accounts in our community who are probably sick of people, you know, two days after their tax return has been lodged to be asked, oh my, oh gee, where's the app? They don't know, they don't know, they can't see it. Sorry. Sorry. And then also COVID nineteen is not going to change those dates, so it's just standard procedure for lodging tax returns this year.
Moral of the story, paying tax is a privilege. Don't play seek privilege, Like.
Let's change our mindset around this. I've said it a million times on the broadcast, like how lucky are we to live in a country where we have access to absolutely everything that we have access to and the support we have access to, and that's what tax affords us. Like it's sick. I think it's great.
So but you said earlier, don't stress if you haven't lodged your tax because you won't go to jail.
It might all even now out of jail. The atier is going to come down on me for saying that as well, because you should have done it by the thirty first of October. Obviously you could be up for some penalties.
When you say penalties, what does that mean?
Fine? Fine, money, honey. Look, they can be hefty demands. How much tax you've avoided, my friends, Okay, but at the end of the day, I don't want you to be stressing if you haven't done it. I just want you to pull your finger out and get it done. This year, we say the thirty first of October because that's the date that after that date you'll start to get penalties and the atier might chase you for doing that, and like people have gotten letters before for you know,
not lodging their tax. But I would just be trying to do it by that date, getting it done, and if you haven't done your tax from last year, just maybe pulling your finger out and speaking to an accountant because they are going to be the ones that are got to put you in the best possible position to avoid having any penalties to actually pay on that, because they'll go, look, we're just organizing it for them. Perfect easy, easy, easy peace. Let's wrap the even more boring but important stuff.
That's the way already.
Guys.
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