As a newcomer to Australia, filing your first tax return here can feel daunting. This guide will explain the basics of the Australian tax system and tax return process to help you successfully lodge your return.
In Australia, individual taxpayers are required to lodge a personal tax return each financial year (1 July to 30 June) to declare their income and claim eligible tax deductions or credits from the previous year. The lodgment deadline is generally October 31, though some may receive an automatic extension to May 15 if using a registered tax agent.
The tax return form assesses your income tax liability based on resident status and worldwide income earned during the financial year. The starting point is determining your assessable income – this includes employment income like wages, salaries, commissions; income from investments like dividends, interest; government payments; and business or rental income if applicable. You will need to provide income statements like payment summaries and dividends statements to verify amounts declared.
Filling out your tax return allows you to reduce your total taxable income by claiming eligible tax deductions. Common deductible expenses include work-related expenses like a new uniform or tools if required for your job; donations to charitable organizations; interest paid on loans for gaining income; and private health insurance premiums. Keep clear records like receipts to support any amounts deducted.
The tax office will use the information provided in your return to calculate your tax liability for the year. If too much tax was withheld from your pay during the year compared to your actual liability, you are entitled to a tax refund. On the other hand, if not enough tax was withheld you may need to pay the additional amount owed.
There are a few options for lodging your return. We suggest using our online tax return services. It is super friendly to the users who are new to Australian Tax returns. Once submitted, the ATO will process your return within about 2-4 weeks and notify you of the final outcome.
With the right guidance, the tax return process in Australia is straightforward. As a new resident, I recommend familiarizing yourself with the basic tax rates and available deductions so you pay the right amount of tax. Let us know if you need any clarification on how to successfully lodge your first Australian tax return.