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.”