Category: Tax Accountant

The Tax Office has flagged work-related car expenses as a concern this tax time.

The ATO is targeting those who make mistakes or deliberately lodge false claims. Examples include:

• Claiming things they are not entitled to, i.e., private trips such as work to home travel
• Making claims for trips that did not occur
• Claiming expenses that their employer has already reimbursed them for.

Advancements in data-matching technology allow the ATO to match individuals with peers in similar occupations, earning similar amounts of income. Analytics is also used to identify claim patterns, i.e., over 800,000 people claimed exactly 5,000kilometres under the cents per kilometre method last year.

The best way to avoid making a mistake include:

•  only making a car claim if you paid for the expense yourself and were not reimbursed;
•  it was directly related to earning your income; and,
•  you must have a record to support the claim.

An example of a legitimate car claim is travelling between work sites or between jobs as part of your job.

Before you submit a car claim, consider if your employer would agree you needed to undertake the trips as part of your job. Employers may be contacted if your claim raises a red flag.

Federal Budget 2017: How much the Medicare levy increase will cost you

One of the most expensive measures announced by the government in last night’s budget was its commitment to fully fund the National Disability Insurance Scheme until 2020.

This doesn’t exactly come cheap.

Before Morrison announced he would increase the Medicare Levy by 0.5 percent – from 2 percent to 2.5 percent – there was a gaping $55.7 billion funding shortfall for the scheme.

So what is the levy, and how much will it cost you?

Under the government’s new plan (if it passes through the senate) the Medicare levy will increase to 2.5 percent on July 1, 2019.

The only people who won’t have to pay are singles earning $21,655 or less, and families earning $36,541 or less.

You can check how much you’re currently paying under the 2 percent Medicare Levy at the ATO’s online calculator.

But just because the government has laid out these plans does not automatically make them gospel – under Morrison the measures have been moved to be legislated, which means they’ll still be debated in parliament.

And that just may prove to be the toughest sell yet, as many pollies have already come out against the Medicare Levy increase.

“I think they need to start that maybe in the mid-$30,000 mark – I think starting around that $22,000 is too low,” Crossbrench senator Jacqui Lambie told Sky News today.

“These guys are (earning) just over what welfare recipients receive. I am concerned about that and I believe Labor is concerned about that as well.”

Greens leader Richard Di Natale said the income threshold should be lifted, but he had wider concerns about the need for extra taxes on low-income earners.

“Why are you giving a tax break to someone on a million bucks but increasing taxes if you are on $22,000 a year?” he told reporters in Canberra.

“We will be talking to the government about how they can make that reform fairer.”