The new financial year brings with it significant changes to the tax system. With new exemptions being introduced, a multitude of perplexing figures and overwhelming paper work, it is understandable how tax time can become very confusing for tax payers. Generally speaking, anyone who earns over the tax free threshold during the course of a financial year, 1 July – 30 June, is required to submit an individual tax return to the Australian Tax Office.

You, as an individual, must pay tax to the Government in proportion to your earnings for the financial year period. In addition, to the marginal tax income rates that are used to calculate the base amount of tax payable, taxpayers may be eligible to claim deductions or offsets that may further reduce the amount of tax payable. In the recent federal budget a new 50% discount on up to $1,000 of interest income from savings for eligible taxpayers was introduced.  Additionally, the Education Tax Refund is a new rebate on offer to people who have incurred eligible education expenses in the last financial year.

Tax Rates 2010-11

Taxable income

Tax on this income

0 – $6,000

Nil

$6,001 – $37,000

15c for each $1 over $6,000

$37,001 – $80,000

$4,650 plus 30c for each $1 over $37,000

$80,001 – $180,000

$17,550 plus 37c for each $1 over $80,000

$180,001 and over

$54,550 plus 45c for each $1 over $180,000

 

Personal Income Tax Returns address all significant financial transactions by the taxpayer for the year. So this includes not only income from employment and wages but also regular income from investments and rental properties as well as one-off payments as a result of the sale of assets. Additionally, any losses incurred during the period also affect the net amount of taxable income and hence the total amount of tax payable by the taxpayer.

If you are submitting your personal income tax return yourself it must be lodged with the Tax Office by 31 October each year. However, if your return is prepared and lodged by a registered tax agent the deadline is significantly extended. It is important to diligently submit regular tax returns in order to avoid incurring penalties and the increased possibility of being audited.

This year it has become extremely important to be aware of scammers with sophisticated tax time phishing emails. These purport to come from the ATO but are really designed to steal people’s banking details and passwords. Don’t be fooled by the ATO logo and links to the ATO website in emails that offer online tax return preparation, and con internet users with subject lines and key words such as ‘benefits of e-tax’, ‘eligibility requirements’ and ‘click here to get tax refund’. The scams are made to look legitimate.

The scammers try to lure users into giving away personal details including banking information and passwords by saying that these details are required in order to get the refund. Other emails contain links to phishing web pages designed to look like a legitimate online tax return. Information is then able to be gathered by these scams in order to access their victims’ accounts and steal money. It could also be used for identity theft.

Be alert to potential email or phone scams or suspicious door knockers. The ATO will never ask for your personal information such as credit card details, your TFN, your date of birth or passwords. You can avoid scammers by keeping you browser, security and spam filter software up-to-date, never click on links in unsolicited emails and be suspicious of any requests to enter account names, passwords and other confidential information.

In order to simplify the tax system and the processes involved in completing your individual tax return, The Quinn Group’s team of  accountants have introduced the FREE Tax Record Kit. The easy step by step guide will help you to gather all of the information and documents required to prepare your tax return. Simply complete the tax record kit, send it back and for a fixed fee we will take care of the rest for you. We also have a business tax return checklist for our business clients. Please contact us ASAP if you have not received your 2010 Tax Record Kit from The Quinn Group or would like one of our 2010 business tax return checklists.

Here at Quinns we work hard to ensure that our tax clients are aware of what they can and cannot claim on their returns and we work with you to legally minimise the amount of tax that you are required to pay. For more information or to claim your FREE Tax Record Kit submit an online enquiry, alternatively call us 1300 QUINNS (784 667) or +61 2 9223 9166 to book an appointment.

Enquire today and we will get back to you next business day.