ATO guide to the 5 most common Tax Time mistakes

As Tax Time 2018 has ‘kicked off’, the ATO has profiled the five most common mistakes they see, including taxpayers who are:

• leaving out some of their income (e.g., forgetting a temp or cash job, capital gains on cryptocurrency, or money earned from the sharing economy);
• claiming deductions for personal expenses (e.g., home to work travel, normal clothes or personal phone calls);
• forgetting to keep receipts or records of their expenses (around half of the adjustments the ATO makes are because the taxpayer had no records, or they were poor quality);
• claiming for something they never paid for – often because they think everyone is entitled to a ‘standard deduction’; and
• claiming personal expenses for rental properties – either claiming deductions for times when they are using their property themselves, or claiming interest on loans used to buy personal assets like a car or boat.

ATO Assistant Commissioner Kath Anderson reiterated the three ‘golden rules’ for work-related expenses: “You must have spent the money yourself and not have been reimbursed, it must be directly related to earning your income, and you must have a record to prove it.”

The Money Edge | Bundaberg