Affinitas Accounting Clients Join the Billion Dollar July Tax Rush
Tax time 2020 is well and truly in full swing, with the ATO reporting its “biggest 1 July ever”, with over 740,000 online lodgements on that day alone, up from just 100,000 lodgements on 1 July 2019.
The first two weeks of July resulted in 1.7 million individual tax returns lodged, a 12 per cent increase on the same period last year. The average refund amount this year currently stands at $2,365.
ATO assistant commissioner Karen Foat said more than $1 billion had already hit taxpayers bank accounts, with processing continuing into the third week of July.
This busy start to the tax season has seen our Affinitas Accounting tax team working hard to keep up with demand. New online and remote systems of working have helped improve turnaround and efficiency.
Affinitas Accounting clients are embracing the convenience of virtual appointments and it is enabling more appointments to be held, and more returns to be processed, each day.
Affinitas Accounting’s senior tax consultant Deb Duncan says the new systems are working well. “I think people are this year finding remote returns so much easier and more convenient,” Deb said.
“I always look forward to catching up with a lot of my regulars during tax season, but we can still do this via phone, email and/or Zoom – just like we’ve all had to with our families and friends,” she said.
“And with the Covid-19 related health issues happening in southern states, we feel we are doing our little bit to help minimise anything like that happening in Queensland.”
However, the ATO has urged early lodgers to take care in preparing their returns, with early analysis having revealed three trending mistakes.
Ms Foat said the first issue included claiming multiple working-from-home methods for the same period, with some taxpayers accidentally or deliberately confusing between the ATO’s recently introduced 80 cents shortcut method and its standard 52 cents fixed-rate and actual cost method.
“It’s important to remember that if you’re claiming under the working-from-home shortcut method for 1 March to 30 June 2020, you can’t claim any other expenses for working from home for that period,” Ms Foat said.
“If you want to specifically claim the depreciation of big-ticket items like laptops or desks, you can use one of the existing methods, but you can’t double-dip and claim under the shortcut method as well.
The second issue was where taxpayers simply copied and pasted their deductions from the previous year, failing to account for a reduction in claims due to COVID-19. In many cases, taxpayers will have reduced expenses for claims such as work related travel and uniform due to working from home.
The final issue was the failure to report all income, with prefill information unlikely to be 100% accurate so early into the new financial year.
“Unfortunately, we can confirm that approximately one in five people who lodged early won’t be getting their refunds in the first batches out because they didn’t take the time to include all their income,” Ms Foat said.
For those lodging early, it was crucial check information like cash wages, foreign income and all interest/dividends were included.
To book your virtual 2020 tax appointment, contact firstname.lastname@example.org or phone 07 3510 1500.