Ten Easy Ways You Can Pay Less on Your Taxes
We asked our very best accountants who handle our small business accounting, to explain to us 10 easy ways for paying out less taxes to the government every year, and keep more money we've earned by the sweat of our brow. They were chock full of answers and all of them legal.
Here are some simple habits they explained to us that will help you save money and pay less taxes:
(1). Keep Great Records - This is their #1 suggestion for paying less taxes. Be sure to claim each and every expense you have coming to you. This helps the entire process to flow along smoothly. Organize yourself and stay organized all year round. It's not that hard to do.
Maintaining good records is not rocket science. It's very easy if you take around five minutes every week to place all your receipts into a place that's easy for you to access and will keep them safe and all together. Update them weekly. As Melbourne accountants for small businesses, we will guarantee that doing just this one thing is going to save you a lot of pain come the end of the year. You'll also be paying less on your taxes.
(2). Charity Works in Your Favor
Most people are not aware that each donation they make over $2.00 and made out to a registered charity can be deducted on their taxes. Receipts are given when you make a donation, and when it's tax time and you have those receipts, you're allowed to claim them as tax deductions on the preceding year. Donating to good causes enables you to pay less on your taxes.
Always remember to place your receipts into the folder you've prepared. When it comes time to do your taxes, you'll know right where they are and you can claim those extra deductions and pay less on your taxes.
NOTE: Donations will not show up directly on your next tax return. They get subtracted from the amount of your taxable income. That means you'll be getting back a percentage that is determined by your level of income and your rate of taxation.
(3). Claim Everything You Have Coming to You
When you incur work-related expenses you can claim those expenditures and pay less on your taxes. Things like transportation, tools, work clothes, and other work-related expenses are claimable. Claiming these types of deductions is one of your most powerful weapons against paying more taxes. Keep all the receipts from anything you spend that is related to your work. Even if you aren't sure if it's deductible, it's better to have it and get nothing for it, than to not have it and be able to get something for it. For things that are 'partly' for work and 'partly personal', you are allowed to claim what they call an 'apportioned' deduction.
(4). Get Advice From Tax Pros
Many times best accountants for small business or a tax agent can really be a lifesaver. They can improve on the amount of your tax return. That's why all the statistics regarding ATOs reveal that 70% of all Australians choose to engage the services of tax agents like Etax.com.au.
We are the tax experts here at Etax. We employ the latest updated methods and carry in-depth knowledge in the area of tax laws and all the newest changes. We could quite possible find that you're entitled to many deduction you weren't even aware of, or maybe find some kind of an offset you never knew existed. Our people are always finding little mistakes that can slow a taxpayer's refund down or maybe even spark an audit. One of the best parts of our services is that Etax online return costs are minimal and you can claim the as a deduction as well.
(5). The Medicare Levy Surcharge
People who don't have their own private insurance policy, once they have an income that goes above $90,000 (as a single) or $180,000 (as a family), they still have to pay out a minimum of 1% more (Medicare Levy Surcharge). This 1% is paid out on top of the mandatory 2% Medicare Levy that most all Australian taxpayers pay out.
(6). Never Skip Small Items
It doesn't matter if your deductions come to $2, $5, or $50, it all ads up during a year's time. Make sure you keep immaculate records and all your receipts, regardless of how small or petty they may seem at the time. Believe me, the amount will surprise you when you file for your return. Contact Etax and let a small business xero expert show you the ins and outs of filing the best return for your specific situation.
