It's that time of year again! Tax time ??

By the time July rolls around many of us are daydreaming about what our tax refund will buy us. That trip to the snow, the new tv, maybe even an escape to the sun and sand. The reality is July is just the beginning. Your employer and financial institutions are just warming up... you probably shouldn't be lodging right now. That's right I said don't lodge your return just yet!

That's because many items that are reported to the ATO are not final. You need to wait until your employer has updated your income statement (the digital version of a PAYG payment summary for most employers who have moved onto Single Touch Payroll) to say, "Tax ready". This should have been done by 14 July.

In addition, any Employee Share Scheme income (shares and stock options) need to be reported to the ATO and some employers have an extension to 14 August.

Why do I have to keep waiting???

Well if you received any income from other sources like:

• Interest from a bank,
• Distributions from a trust,
• Dividends from shares... etc

The payers of this income are still sending the ATO details of what you received. You should wait until they have finished which is usually around the end of the month. (but sometimes longer for trusts)

Your private health insurance details will also be provided to the ATO. This is important for the private health insurance rebate and Medicare Levy Surcharge.

Lodging prior to the finalisation of these items could result in an income matching notice from the ATO if the amounts you report in your return don't match those provided directly to them from other sources. There could also be interest and penalties charged as a result.

Alright Ursula... everything is in there, what do I do now?        

Now you can lodge. Canstar has republished my article, "How to Lodge a Tax Return in Australia" where you can read about the next steps. You can read the article here or I have included a useful excerpt below:

How do I do a tax return? 3 steps

There are 3 steps to follow to do a tax return:

1. Choose the process you want to follow
2. Gather your income and deductions
3. Submit

1. Choose the process you want to follow

Decide if your affairs are complex and whether a tax agent might be the best solution. The ATO says that in addition to lodging with a registered tax agent, you can consider lodging your return online with?myTax, or?lodging a paper return.

Should I consider using a tax agent?

If any of the following circumstances apply to you, a tax agent could provide advice and help ensure your tax affairs are properly managed.

• Complex tax residency.?If your travel patterns have been impacted by the pandemic or you normally spend a significant period of time away from your usual place of residence each year, your tax residency may not be straightforward. Tax residency determines how much, if any, of your income is taxable and/or reportable in Australia, and may be different to your residency status for immigration purposes.
• Major transactions (such as selling a property).?The legislation to determine the cost base and sale price of an asset can be difficult to understand for many people, and getting it right could potentially make thousands of dollars of difference in tax. The interaction of rules regarding residency and the?main residence exemption?can easily make selling a property challenging for the average taxpayer.

Wider reasons you may also consider a tax agent include if you might need help with:

• family trusts
• are self-employed or running a business
• have foreign income or tax paid
• are a temporary visitor to Australia without access to a Medicare card.

The Tax Practitioners Board (TPB) is a national body responsible for the registration and regulation of tax agents. If you’re comparing tax agents, look for the TPB’s symbol to confirm you are using an approved practitioner, or search for one using the?TPB website.

2. Gather your income and deductions

It’s best to start gathering your income and deductions as soon as 1 July by using the ATO’s?myDeductions?app or a similar tool. Tracking your expenses throughout the year will help you remember everything, so you can provide the details directly to the ATO or to your tax agent when it’s time to start your return.

3. Submit

Provide your collected information to your tax agent, or start your return through myTax. The?myTax?experience is user-friendly for a taxpayer who doesn’t have complex tax matters to worry about, like those noted.

You will require a?myGov?account and may also set up a?myGovID?in the setup. Both require details from documents to prove your identity. myTax is pre-populated with information that employers and financial institutions are required to report directly to the ATO, including your income and tax withheld throughout the financial year.

How do I lodge a tax return?

You can lodge a tax return electronically, either through your tax agent or in the myTax app. It is possible to lodge a return via paper form; however, this process can take significantly longer. The ATO generally prefers to deliver refunds electronically and will only make payments into Australian bank accounts.

How long does a tax return take?

The ATO says it aims to process electronically lodged tax?returns?within two weeks. When a Notice of Assessment (NOA) has not been issued within 28 days, tax agents are able to escalate with the ATO to resolve the matter.

What tax return deadlines apply?

Tax returns for individuals without a tax agent are due on?31 October?following the?30 June?end of the financial year.?Tax agents can provide their clients in good standing with the ATO (i.e. those who have no outstanding tax returns) with extensions?beyond 31 October.

• 15 May?following the?30 June year end?is the latest extension widely available for taxpayers
• 31 March?is the concessional due date for those with prior year tax liabilities greater than $20,000.

The tax agent extensions also include additional time to pay. Tax payments are typically due?21 days?after the due date of the tax return or the issue date of the Notice of Assessment (NOA), based on whichever is earliest, with prior year tax liability the amount that was due on the NOA for the prior year.

I got it.. calculating that refund now!

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Ursula Lepporoli is a highly sought after and well travelled global mobility tax expert - who enjoys helping her clients to find practical solutions to real world problems. As a partner at one of the leading firms she has access to a wide breadth of clients and enjoys sharing her learnings with her followers. Follow her, and?subscribe?to the Mobility Matters newsletter?here.

**The views expressed above are mine alone and are not tax advice. **