She's On The Money - Getting Ready For Tax Time

Episode Date: June 13, 2023

EOFY is our favorite time of year, but it can be intimidating if you don’t feel on top of your income tax. Don't worry, we have you covered! Today we look at some changes to tax that  you should be aware of, things the ATO are cracking down on this year, plus we give you some tips to help this time of year run a little easier. Acknowledgement of Country By Natarsha Bamblett aka Queen Acknowledgements. The advice shared on She's On The Money is general in nature and does not consider your individual circumstances. She's On The Money exists purely for educational purposes and should not be relied upon to make an investment or financial decision. If you do choose to buy a financial product, read the PDS, TMD and obtain appropriate financial advice tailored towards your needs.  Victoria Devine and She's On The Money are authorised representatives of Money Sherpa PTY LTD ABN - 321649 27708,  AFSL - 451289.See omnystudio.com/listener for privacy information.

Hello, my name is Natasha Nabanunga-Bamblett. I'm a proud Yorta Yorta, Kernai, Wolperi and Awadjeri woman. And before we get started on She's on the Money podcast, I would like to acknowledge the traditional custodians of the land of which this podcast is recorded on Awadjeri country, acknowledging the elders, the ancestors and the next generation coming through. As this podcast is about connecting, empowering, knowledge sharing and the storytelling of you to make a difference for today and lasting impact for tomorrow. Let's get into it. She's on the money.

She's on the money. Hello and welcome to She's on the Money, the podcast for millennials who want financial freedom. My name is Bec Syed. Victoria Devine is with me. We are talking about... Wow, you were just trying to jump straight into the tax conversation. I was about to. You were so excited that you almost forgot that I'm just as passionate about tax as you are. And I forgot you were here. Oh, really? That's crazy.

Because, you know, I am actually like, you know, a bit of an expert in finance. Yeah, I heard you were like kind of becoming a tax expert. Oh, yeah. I would, you know, it's not a stretch. So what date are we working towards? So June 30 is fast approaching. So we're going to be talking about tax time. Are you excited? Yeah, because June 30 is my birthday. Oh, yeah, of course. So 10 out of 10, always excited. Can you think of a better birth date for this finance girlie? I can't. It's not a single date. Maybe like the 1st of July. Maybe.

New tax year would be a good one. But like June 30, my dad's an accountant. So I was born to ruin his accounting each and every single year. And I just live for that. I still live for that. But I'm very excited. I can imagine that a lot of people are probably just really excited about this time of year, Bec. But I do imagine it's a time of dread for a lot of people. Yeah, Bec, look, it can feel a little bit intimidating if you don't feel like you're on top of your income tax, which is exactly why we're doing an episode today to get you ready for tax time, the sexiest time of the entire year. We're going to be looking at some changes that you really should be aware of and also some things that the ATO are cracking down on this year

and then we're going to give you some tips and tricks to help this time of year run a little bit smoother I feel like that's a good way to kind of like do a tax episode if we're being honest yeah perfect nice and easy nice and gentle and did you know that the taxman cracks down is taxman tax person unsure of what we're going to be identifying them as but did you know that each and every single year we'll get to it later this episode they actually announce what they're looking out for this year. Would you call it a red herring? Yeah just like a little warning like hey guys we're going to be looking out for this this year and hey guys like this is what we're going to be cracking down on this year. So it's good to know because often the things that they're

cracking down on are related to recent changes which we will get to very soon and they are this year as well. So I'm not surprised by them they're not just picking random things they actually have some method to their madness, but it's good to just be in the know. It's not maybe the sexiest episode, let's be honest, but it's one of those episodes where you're going to walk away being like, no, I can actually do that myself. I do feel like I'm completely in control of this process and I'm no longer overwhelmed. So we love that. Wow. That is a perfect outcome. I hope they're not just like trying to throw us off the scent. They're not trying to throw us off the scent. They actually really want us to pick up on the scent so that they get to do less work. It's

quite intelligent, to be honest. Oh, that's very smart. Yeah, exactly. V, this might actually surprise you, but I have prepared some stats for you. Are you trying to take my job as resident stats gal? I thought I was being subtle about it, but maybe I'm not being so subtle. Maybe next time don't announce it. Ah, good idea. Next time I try to take a job. So what are your stats, stats girl? Did you know that in 2019 slash 2020, Australians paid $446.4 billion in tax? That's so many dollar ruse. But the ATO reckons that if all Australians... What are you doing with that elbow? Yeah, that's a very good question. What are you doing with that elbow? Should we call him? I've got him on speed dial. Oh my gosh, do you know what? If anybody has elbow on speed dial, it

absolutely would be you. Sometimes we go to coffee. No doubt. I mean, we work for ARN, wasn't here at Kyle Sanderlands' wedding. True. So we basically have him on speed dial. We could get in touch with him. So that's not too far. We could if we wanted to, but we don't want to. We just want to do this tax episode. Exactly. So the ATO reckons that if all Australians were paying the correct amount of tax, they would have received $479.8 billion. Yeah. So some people are being a little bit cheeky. That's not actually too bad. What do you mean?

You're still in the $400 billion. Oh, yeah, sure. That's not a big discrepancy at all. Like if those were my bank account details, I would not be mad about that at all, Bec. Each year, the ATO actually makes a list of things that they're going to be paying closer attention to, which I mentioned before. And for the next round of tax reporting, that's actually going to be all about improving their systems and also our awareness, or let's be honest, the honesty to get more money back into Treasury. That figure that you mentioned, Bec, still means that 93% of people in Australia are paying what they owe. Those percentages are pretty good because if you compare it to the USA, their figures actually sit

at around the 85% mark. We've said this on the podcast before, please substantiate your claim Like if you're just going in and being like, oh, I work as an executive assistant. Oh, look, I can claim up to $200 on, you know, sun care products without receipts. I'll just claim that. That's actually illegal. Like you need to be able to substantiate that with proof, with a receipt, with something. Even if they're not asking you to submit those receipts, they can actually audit you. And we have had people in our community get audited and they're like, oh, but I just claimed up to the threshold. It's like, yes, but the ATO can come back and ask you to prove that. And each year they take a bucket of random people and they audit them to make sure that we're doing the right thing and being good people. So essentially the golden rule at tax time for everybody in our community is if you can't substantiate it, don't claim it. That's so scary.

It can be scary, but I just also think it shouldn't be scary if you're doing the right thing. Yeah, that makes sense. Like if you haven't claimed things that you haven't spent, then it is what it is. And I mean, if, you know, the taxman came knocking and said, hey, you've been picked up in the audit and we're just going to audit all your expenses and Suncare came up, right? Like Suncare sounds so small, but it's something that so many people can be picked up on because it's like a very low threshold where you go, oh, that's another 200 bucks.

I don't have to prove that I spent. They're going to ask you to prove that you spent it. If you don't, you're going to be up for one paying it back, but you'll have to pay it back with interest. That's essentially a fine back. And that is scary. I don't want to be in trouble with the tax man. Don't be in trouble.

Then you have a little red flag against your name for next year and all of it's just not worth your time, I promise. Yeah, that actually makes sense. So I guess we should go into the changes for this year. What are they? So there are a few changes. So I've round up the big ones for individuals first. The first one's not that great.

The low and middle income tax offset, it didn't get extended. So as a result, low to middle income earners, they might see their tax refund from July 2023 reduced between $675 and $1,500 for incomes up to $90,000, but phasing out up to $126,000. Just feel like they could have extended that each to their own. The Medicare low income threshold for 2022-2023 year is going to be increased, so we do like this. For singles, this will be increased to $24,276, which is up from $23,365 for the 2021-2022 year. And then for couples with no children, the family income threshold is going to be increased up to $40,939, which is an increase from $39,402 from the 2021-2022 year. So the additional amount for threshold for each

dependent child or student is also going to be increased to $3,760, up from $3,619. Personally, I think that could have gone a little bit further, but you know what? At this point in time, Bec, you get what you get and you don't get upset. Sorry, V, I know that we have a full episode to go through, but I just wanted to quickly ask. I have no idea, one, what a tax offset is, and two, what a low income threshold is. Okay, so. So I am reacting like I do, but I don't actually know. That's literally fine. So classified as a low income threshold. So this might sound like a lot of money, but to receive the low income tax threshold, your taxable income needs to be less than $126,000. You also have to be an Australian resident for tax purposes. If you earn under that,

you're going to get access to a few different like tax offsets. So a tax offset is something that you can claim that other people might not be able to claim. So they're saying, look, because you have a lower income, we're going to allow you to claim a little bit more than a higher income earner just to kind of make life easier for you. And often they do this during periods of turmoil where gas and electricity and stuff are really expensive to hopefully get some more money back in your pockets. $126,000 sounds like a lot of money, but in reality, I won't say it's not because it is a lot of money for a lot of people. But if you're a, you know, a dual income household and your total household taxable income is $126,000 and you have kids and stuff, that does

not go as far as you think it does. So these offsets kind of come in to boost you up a little bit. The other benefit there is often you can get access to things like healthcare cards and stuff like that. So if we say you're on a low income threshold, it means that you basically have access to a few different, I guess, let's call them bells and whistles that other people might not have access to purely because you don't earn more than a certain amount. It's the government trying to put you in a better position because, you know, we want you to be paying less tax if you have less income, which I think is a fair system. That makes a lot of sense. Thank you, V. Sorry you may continue. Oh, thank you so much. But I think it's important, Bec, and, you know,

there are a lot of people that listen to this podcast and, hi, if you're new here, I'm Victoria and this is Bec and we love what we do. But someone might have picked up this episode because they're like, oh, far out, tax time's coming. I'm a little bit stressed. And this is their first introduction. Like those are really good questions to be asking. And I've said before, there's no such thing as a silly question in this community, especially from you, because if you're thinking it, our community are thinking it. So please, always, always, always buddy. And I think it's really, really important. Thank you, Bea. Of course. So the next thing I wanted to address was for single seniors and pensioners eligible

for the seniors and pensioners tax offset. So they get, you know, some more cash in their back pocket because they are a senior. The Medicare levy low income threshold is going to be increased to $38,365, which is up from $36,925 from the 2021-2022 year. The family threshold for seniors and pensioners is going to be increased. This is like dual income. Increased to $53,406 up from $51,401, which is a nice little bonus, plus $3,760 for each dependent child or student. So that's nice again. These next two are a little bit further down the track, but they are to me a pretty big deal. So under the stage three tax changes from the 1st of July 2024, the average marginal tax rate is 32.5%. It's going to be cut, Bec, and we're going to be paying less tax if

you're in that bracket. It's going to be cut to 30% for one big tax bracket between $45,000, get this, all the way up to $200,000. That is a far wider range than it was before because historically, it was up to about $120. So that's so much more money. This will then more closely align to the middle tax bracket of the personal income tax system with corporate tax rates. So the 37% tax bracket will be entirely abolished at this time, which is kind of cool. But this means that from the 1st of July 2024, Bec, there's only going to be three personal income tax brackets. So 19%, 30% and 45%. So from the 1st of July 2024, taxpayers earning between 45 grand and 200 grand, they'll face a marginal tax rate of 30%. And with these changes, around 94% of

Australian taxpayers are projected to face a marginal tax rate of 30% or less. That is so good. That is such a low average tax rate. And I think that that's really sexy. If you didn't keep up with that because I feel like I do talk very quickly when I get excited about something. More people, better off when it comes to tax. Yes. Full stop, end of story. More people, paying less tax. That's pretty sexy, Bec. That's so good. More people, less tax. What a good outcome. What a great outcome. I really, really like that. There is another update, Bec. I just wanted to share this because I thought it was real cool. It doesn't happen until 2026, but I mean, time flies when you're having tax fun. Are you ready? Superannuation as of the 1st of July,

2026 will actually be paid on your payday, not quarterly, not annually. It will be paid every time you get paid, which at the moment for most people, I would say that their employers pay tax on a quarterly basis. So once every three months, this is actually really good for you because the more consistently that you're investing, the more opportunity you have to make use of something called dollar cost averaging. We've spoken about this on the podcast before, but dollar cost averaging is essentially where you're investing more regularly. And your superannuation, as we know, is a tax structure that you're investing within. And if you're investing more regularly, what that means is you're making the most of the highs and the lows of the market. So instead of

be investing four times a year. You'll be investing probably 12 if you get paid monthly and you'll be investing 26 times if you get paid fortnightly. I think that's pretty sexy. Yeah. Okay. That's so good. I love that. All right, Bec, you have a little graphic design business. If people want to check out your graphic design business, what's the Instagram URL? Oh, this is so nice, Vicky D. Well, sorry, I shouldn't call you that. You can call me whatever you want, but ideally you call me a nice name when I'm being nice to you. Yeah, that's true. Beautiful Queen. Thank you. It's designed by Beku. Beku is spelt B-E-C-U. It's really cute. If you haven't checked out Bek before, she has just recently, is it recent? It's quite new. Like it's been around ages,

but like you've just started taking it seriously, right? That is true. I kind of like, ebbs and flows, but recently I have been more active on it. But you've become a small business owner technically recently and started to take it very seriously. So I thought right here would be a good spot to have some small business owner tips. I know there are a lot of people in our community who have either side hustles or small businesses, and this is where you need to listen up because these things are actually really important. I don't care if you just drive an Uber a couple of nights a month, but those things are not counted as hobbies. I do not care what your accountant says. If you're deriving income, we need to make sure that we are being

transparent to the government because I have seen too many times and you'll see in our Facebook group come tax time, there will be an influx of posts like this. Oh, my accountant said that I earned less than $5,000 so it was a hobby. No, you worked for Uber or you worked for DoorDash or you did something that was generating an income that was definitely not a hobby. The government's going to want to know about it. But one of the things that I think is worth mentioning here is the instant asset write-off. It's going to return with a $20,000 threshold per asset from the 1st of July 2023 to the 30th of June 2024. So this is a relatively like good thing in general because instant asset write-off means that you can claim the depreciation of an asset. So how much an asset

is going to decrease in value over time in a one-off lump sum. And that is good for tax. If you had a good year where you had a good amount of income come in, that's a good way to write things off. Car owners or people who want to buy cars are not too impressed because on the 1st of July this year, it is going to drop down from about $59,000 worth of instant asset write-off for your car back down to the $20,000. So if you're looking for potentially a car, now's the time to have a quick chat with your accountant to make sure that maybe you could slip in before the new financial year. But small businesses with aggregated turnover of less than $10 million, can you believe that's what's constituted as a small business?

I've got less than $10 million. So are you tiny? What? Tiny little business. Wild. They're going to be immediately able to deduct the full cost of eligible assets costing less than $20,000 that are first used or installed ready for use between the 1st of July 2023 and the 30th of June 2024. So that $20,000 threshold is going to apply on a per asset basis. So small businesses can basically instantly write off multiple assets, not just one. You can write off a whole heap of them. And you know what? You're like, hey, what could be $20,000? If you're a

small business and you work in beauty, maybe you're buying a laser machine, maybe you're buying like IPL, maybe you're buying something like a facial machine or something that's really expensive and you really want to reinvest in your business, this is where you need to talk to your accountant to make the most of these benefits. Because if you don't understand them and you don't know how to use them as a small business owner, you're doing yourself a disservice. We need to be putting ourselves first. And one of the things that you can do to put yourself first as a business that wants to grow is to actually understand what you can and can't do when it comes to tax. Because let's be honest, the instant asset write-off of up to $20,000, you might be like,

what does that mean? That means that we get to claim back the tax we paid on it. That's a big, big discount on an item that you needed to purchase anyway for your business. Sexy. Yeah. Okay. That's making sense. Hot girl stuff. So there's no minimum for assets? No, no. It would need to be an asset though. You can't just go buy a stapler and claim depreciation on that. But like, I mean, it's usually bigger ticket items that small business owners hesitate to purchase because they're like, oh, I don't know if this is going to be like a good thing or a bad thing. Talk to your accountant. We're just sharing general information on this

podcast to kind of like trigger something or to kind of get you to go talk to a professional. At the end of the day, you cannot rely on just this podcast for your tax advice this year. go and talk to an accountant and if you don't have an accountant now's the time to go maybe I need one because you can actually claim accountant's fees on tax next year. Wow so there's been plenty more stuff Bec for small business owners announced I honestly if I was a small business owner I would be heading to the ATO website to read up on them before it gets too close to the 30th of June because when it comes to assets before I told you that it needs to be first used or installed. You can't just buy something and have it delivered midway through

July and claim it in the previous year. Like that's not going to work. It has to happen pretty soon. Okay. So it has to happen before the 30th of June. Otherwise it goes into the next financial year. Time's a ticking. It is indeed. So do you know what you want to talk about next? Unrelatable for you, but might be really relatable for a lot of people in our community, Bec. Savi, I really want to talk about something that I can certainly relate to. What's going to happen to us property investors. Also, I'm just kidding because I'm not a property investor and I don't own any properties, but someone out there might want to know. So what can property investors do this year? What can they do? Except be privileged. Right. So I'm working on it. The

government is actually going to introduce tax incentive changes to help increase the supply of housing. So that's pretty sexy. The incentives are as follows. I've written them down. There are two of them and they're quite complicated and I knew I wouldn't remember them. They're not that complicated, but I knew I wouldn't remember them. So I wrote them down back. So the first is an increase in the depreciation rate. So for capital works purposes. So depreciation is where things lose value over time. And when we say for capital works purposes, it might be like an extension that you're putting on. So the extension this year might be worth 200 grand back. But in a couple of years, like, you know, a 2010 kitchen's not that sexy anymore. I just ripped one out of my

house. And I'm telling you right now, nobody is going to pay for that red splash back. Back in 2010 though, that was a very good investment. That was a very nice kitchen. So it was worth a lot then. It depreciated over time. Now nobody thinks it's worth anything. What about lino floors? I know. Look, we ripped those out too. Also the false ceilings, they had to go. So there was just a lot. But essentially that depreciation rate has been increased from 2.5% to 4% per year for eligible new build to rent projects where construction commences after the 9th of May 2023. And the reduction in the rate of the withholding tax for eligible fund payments for managed investment trusts or MITs, so like completely unrelated to you, but if you're

following along and going, well, that's me, to foreign residents on income for newly constructed residential build to rent properties after the 1st of July 2024 goes from 30% down to 15% subject to further consultation on eligibility criteria. Can you see why I wrote them down? I can see. Yeah. Yeah. So I had to write them down because I was like, there's no way I'm going to remember that mouthful. But essentially, that means that more people will be able to invest as foreign residents. And that's a relatively good thing because it will increase, hopefully, the amount of rental properties that are available for access. And as we know right now, rental properties are going bonkers because there's not enough of them. The home guarantee scheme is going to be expanded

from the 1st of July, 2023. I think this is a very good thing. So the government has announced an expansion to the criteria, enabling people to participate in the different home guarantee schemes, eligibility criteria for all elements of the scheme, including the first home guarantee, the regional first home buyers guarantee and the family home guarantee, they're going to be extended, which is very, very sexy. That actually kind of sounds familiar. Is that where like the government give 25% and you give 5% to a deposit? Or am I making this up? No, you're not making it up. It's absolutely correct. It's actually a scheme that exists to support eligible first home buyers purchase a home sooner. The thing that personally I like about this is that the

government's basically underwriting you, but they don't own any of your property. Where there are schemes out there where the government kind of like co-purchases with you. And when you sell the property, you owe them an amount of money. And I don't particularly love the strings attached to that. But essentially, there are only a limited number of places. So the places that are going to be available in the 2022 slash 2023 financial year are 35,000 places. And it means that you could purchase a property with a 5% deposit. If you're a first home buyer and you've like never purchased property before and you're purchasing a new or an existing home, you could be single, you could be a couple, but then depends where you're purchasing because obviously different

properties in different areas of the country have different amounts that they are worth. Maximum price purchases will apply. So like Sydney is going to be higher than, you know, Canberra, for example. So I think it's important to just look into it. If you're interested in that though, the best thing you could do is talk to a broker. And obviously I'm quite biased. I own a mortgage broking company. And if you happen to be listening to this podcast, you probably would get along really well with us. Go check out Zella Money and we can sort you out and tell you whether you can get into that or not. Because when we say there are 35,000 places each year, usually that 35,000 amount is divided up among the years. So there might be, you know, a quarter each quarter

available or open, and they're actually only available through certain banks. So there are like a heap of hoops, but it can be a really good way to get into your first home. And I'm really glad that it's sticking around. Okay. I really like that. I think it's pretty sexy. I just really like that they've kind of prioritized. And I mean, I'm not asking for feedback here. We all know that there are things that could be done better and changed, but it does feel like they have tried to put people who are currently not that enchanted with their property market in a position where they might, you know, get that enchantment back. Yeah, I love that. Each year, the ATO releases things ahead of the EOFY, end of financial year. Oh, she's a tax genius. Oh my gosh, jinx. Genius.

You've got to buy me a Coke. Okay, I'll buy you a Coke. They will focus on certain things ahead of the end of financial year. What are they cracking down on this year? All right. So they're cracking down on a few things. And I alluded to this at the start of the episode. This one is going to make sense and that is working from home. So obviously during COVID, we all worked from home a fair bit, but now everyone's heading back to offices begrudgingly, but we're all heading back to offices. So the ATO is apparently sharpening its focus in 2023 on capital gains tax and work related expenses, including changes to work from home claims. So from the 1st of March, taxpayers claiming work from home related deductions will be required to provide more

detailed documentation. Fair. The COVID shortcut isn't happening anymore. It allowed you historically to claim 80 cents each hour that you worked from home and cover all deducting running expenses. not a thing anymore. Effective from the 1st of July 2022, the ATO announced a revised fixed claim of 67% per hour worked from home. This is supposed to cover additional like running expenses for things like internet and electricity, phone plans or like stationery and stuff you need at home. There are separate deductions that can be made for other purchases. So for things like desk chairs or computers or bookshelves immediately if the price is below 300 bucks or as depreciation over time if it costs more. So you can pick which one there. The crucial point though is that you need to

demonstrate to the ATO that you did only incur these expenses because you are working from home. So you can't just set up like a little at-home office because you think it'll look real chic in the corner of your lounge room and then you don't work from home and then you think you can claim it because everybody else is. No, sis, that's not how it's going to work. They're going to ask for proof. To claim using the fixed rate, you actually need to provide a record of all the hours worked from home for the entire year, as well as receipts or invoices to show you paid for these expenses covered by the fixed rate method. Do you have friends that work from home? Yes. Do you think that they're actually keeping a logbook of how many hours that they're working

from home? Definitely not. No. So like that's something that we should be aware of. And before doing your tax, maybe pop a really simple one together and work it out. Like just do the right thing. Do the right thing. Don't just claim it. I know a lot of people will say, oh, you can claim this or you can claim. It's not that simple anymore. And if you mess up or you do the wrong thing, it can be relatively serious. I mean, the taxman isn't as scary as people seem to make him out to be. It can be not so good when you're claiming things that you aren't entitled to though. And that's where I think professional help could come into it. But if I'm being brutally honest, if you are a salaried PAYG employee, it's relatively easy to work out, hey Beck,

did you incur any expenses this year? Did you have to buy a desk chair to work from home? Yes. Okay. Can you please look up in your bank statements? Because bank statements are easily looked into how much did you spend at Officeworks? Great. You can claim that. No worries. But we really need to make sure that we did incur those things. We're not just writing down, oh, we want a little refund for this and this and this, even when we didn't incur it. Like that's just cheeky and not on. Yeah. I'm just trying to make friends with the tax man. So he's like smiling at me when he looks at my return. Let's be honest. So he doesn't order you this year. Yeah. I'm just like, oh, hey, that V girl. She's really nice. We love her. Oh, hey, Mr. ATO. Yeah. Same, same. But

essentially separate records for claims not covered by the fixed rate will also be necessary. So just record keeping is really important. There is an ATO record keeping app if you want it or if you're a little bit more old school. I don't really want to have an app either. I actually just take photos of things throughout the year. I save it to a random album. Then when tax time comes, I just go to that album and everything I need is there. Once I've claimed it, I delete everything and then i start fresh for the year on that's a great idea i think it's quite smart to be honest obviously don't delete them forever because you do need to keep those things on record for seven years in case you are audited but i remove them from the album because i don't need

to you know quickly check but also low-key phone hack in your phone when you're searching for photos did you know you can just like type in words now and it looks right in the photo i can type in people's name what and it knows your people's name i have a folder of victoria divide Oh my gosh, that's really creepy. Let's move on. Let's move on. All right. So the ATO this year is going to be like narrowing in on people who are claiming a substantial amount or all of their personal phone or internet plan as work related because basically the ATO doesn't believe that. Deductions for purchases like this can only be made for the portion of time that is actually used for business. So like, let's be brutally honest. I don't even bother claiming

my phone anymore because I have an unlimited plan. I pay a set amount each month. And you know what? I mainly use it for TikTok. So I just have stopped claiming that because I don't want to get in trouble. But yeah, only claim what is worth it. And then the A tier is also concerned that too many taxpayers are automatically claiming their 5,000 kilometer limit regardless of the actual amount that they have traveled. So it's 78 cents per kilometer that can be claimed available for journeys of up to 5,000 kilometers, but essentially they're going to be looking into that as well this year. But I think I used to do that, but I was like, where am I going? I'm not going anywhere. I feel like people historically have always been like, oh, well, if you don't need to provide

receipts, I'm just going to claim up to the minimum threshold. And let's be honest, like ATO, please don't come for me. I'm sure like 18, 19, 20 year old Victoria was doing that. I can't remember, but I totally feel like if someone said, oh, you don't have to prove that. I'd be like, yeah, all right. I'm in. Who isn't? Let's be honest, but it's now a more complicated tax system. It's a far more educated tax system. I mean, let's be honest, with the likes of ChatGPT, I'm not saying that the ATO is using that, but with the advancements of technology, I guarantee they are going to be so much more, I guess, advanced at checking whether maybe you are doing the right thing or not without actually having to get too many humans involved. And the

more they're able to do that, the more they're able to crack down on people, because I promise that would be an automated process. I obviously am speaking completely out of tune here because I don't work for the ATO, but if the ATO were smart, they would have created some kind of AI bot that overarchingly looks at everyone's stuff. And if any abnormalities come up, they automatically send an audit letter to you and you then have to prove it. Like that's how I would run it. Don't give them ideas. No, but it makes sense, right? And like, if I'm thinking of that, I guarantee someone at the ATO is thinking that. So it's just, it's better to be safe than sorry. Just do it properly the first

time. That's what this episode is all about. That's very true. V, we've forgotten about one person or people. Oh, have we? Yeah. Who? What about our finance bros and our cryptocurrency wizards? Oh, the finance bros. Do you reckon they'll want to know about crypto? I think they'll want to know about crypto. So you think there are finance bros listening to this podcast. I think they're a finance bro. Do you know what? Hello to the finance bros who are currently driving the car while their girlfriend has control of the iPhone and what is currently playing in the car. That's what's happening. Yeah. Well, no, it's quite clearly she's on the money. They're quite clearly listening to she's on the money. But you know what? That

would have been a better suggestion. Don't know why you guys are still here, but let's talk about crypto. The ATO is also going to be taking a much closer look at those making investments into cryptocurrencies like Bitcoin. So increasing numbers of taxpayers, you're not going to be surprised, are jumping on the bandwagon and the ATO believes that some of them are failing to declare their profits and in some cases their losses, Beck, that they're making on their investments. So you need to remember that investing in cryptocurrencies can give rise to capital gains tax on profits. Traders can be taxed on their profits as business income as well. So we need to be just very aware of that. Cryptocurrency, while it is not a regulated financial asset here

in Australia, it is an asset that you need to declare any profit on. Like if you make 50 bucks from it, you actually have to tell the ATO about that and it's illegal to not do that. But the other thing you need to understand when it comes to assets is how long you hold them. So if you hold an asset, even if it is cryptocurrency, make a whole heap of money on it and sell it within the first 12 months, the tax rate is going to be higher than if you held it for longer than 12 months. So please be aware of that before you decide I'm the best crypto bro ever and I'm making all this money because you might be bitten in the bottom with a nasty tax bill, which nobody wants. Like, let's be honest, just be aware of it. To help them in their search, the ATO is collecting

bulk records from Australian Cryptocurrency Designated Service Providers or DSPs as part of a data matching program to ensure people trading in cryptocurrency are paying the right amount of tax. Data includes cryptocurrency purchase and sale information, and the data will identify taxpayers who failed to disclose their income details correctly. Isn't that a bit scary? That is a bit scary. Just feels like it's getting real serious. Yeah. Do you know what? I'm going to repost this because it was a good TikTok. It was like, hi, tax man. I'm just wondering how much tax I owe. They're like, oh, we don't know. How much tax do you owe? You calculate it and tell us. And then you say, oh, Mr. Taxman, so you're saying you don't know how much tax I owe so I can

pay whatever I want? And they're like, oh, no, we know. We know how much tax you owe. Well, tell us. Like, at what point are we going to not have to do our own tax return because it's just going to be automated? Like, I'll give you access to my bank, Mr. ATO man, go do my tax for me. I don't want to do it? Can't that become an automated process? Nobody likes tax time. Do you know what they like? Getting their refunds. Yes. So just automate that, Mr. Taxman, and we'll be much happier with you. Honestly, the ATO estimates that there are between half a million to one million Australians that have invested in crypto assets. Oh, wow. That's a lot of people. That's a lot of people. And do you know what still scares me? Obviously, this is just personal opinion,

but it's my show. But it just still baffles me that there are so many people willing to invest in crypto, but are still too scared of the share market. They're like, oh my gosh, the share market, that's really scary. And it's like, crypto's worse, but okay. So I think it's all about education. We've done episodes on crypto. We've done introductions to the share market. Go back and look for them. The best way you can do that is actually to just type in on your chosen podcast platform, She's On The Money, and then the topic that you want, and it will automatically come up with linked episodes. So I think a lot of people don't know you can do that. Yeah, that's actually really cool. You don't have to scroll through everything, my friend. You can just type in

She's On The Money Crypto, and our crypto episodes will come up. There you go. It's pretty sexy. That one's for the finance bros. But another huge but still emerging industry is the sharing economy. What have they said about this? So yes, data matching is coming in hot here too. And there is a new statutory obligation on sharing economy platforms to provide information on how many sharing economy participants there are from the 1st of July 2023. So if you're confused, examples quoted by the ATO include services like ride sourcing, transporting passengers for a fare, i.e. Uber drivers, renting out a room or house for accommodation, so Airbnb hosts are the obvious example here. The ATO is believed to be particularly concerned about taxpayers claiming

the full CGT, so capital gains tax, main residence exemption when part of their main residence has been rented out through Airbnb and the law prevents a full CGT exemption where part of the main residence has been used to earn income. So they're like, oh, we see you, we're going to crack down on this. So things like renting out parking spaces, providing skilled services. So you might be like doing web design, graphic design. You might be on like AirTasker, for example. You might be supplying equipment or tools or completing odd jobs, errands, deliveries, or you could be renting out equipment such as tools, musical instruments, sports equipment, or clothing. Oh, Jessica Ricci does this, right? Don't throw her straight under the bus.

Yes, that is a small business. And if you are renting out your wardrobe, it would be a good idea to have a quick chat with your accountant because you might be making bank on that very nice dress that you're renting out. But at the end of the day, that is a business and they are going to want to see whether that is taxable or not. Wow. Talk to your accountant, my friend. Talk to your accountant. I think this is a really good place to have a little break and absorb it all and come back in two seconds. See you on the flip side, guys. Bye. okay so v now we're on to some tips if you don't mind i've got so many tax tips don't be fraudulent is my number one that's the number one yeah yeah it's actually a very good

tip okay in life it's really good i mean it got me in a little bit of hot water a couple of weeks ago on tiktok where i said oh this could potentially be fraud when i said something about people earning Qantas points on particular credit card transactions. You know what happened? Terms and conditions got updated. You can no longer do that. Feels good to be right sometimes. Not going to lie. Not going to lie. I was like, I told you so, but okay. A little bit spicy moving on though. What was your question, my friend? So what kind of things will help us make this whole process a lot smoother? Remain calm.

Remain calm. Remain calm. So often getting your tax refund back, it kind of gets held up because people are making really basic mistakes that could be avoided. So like if your name or address has changed, please make sure you update your ATO info before lodging your return because if you lodge a return under different details, even by accident, Bec, the ATO's data matching technology won't be able to match it to your tax file number and then it will have to go through a longer, lengthier manual process. Not cool. Make sure that your bank details are correct. So all tax refunds are now done by direct deposit. So gone are the days where you actually received like a

little check in the mail. You need to make sure that your bank details on your return are correct. Maybe you've changed banks recently and that account is empty. You don't want to not get your money back. One out of 10 cannot recommend not being paid. Use spell check. So if you've added an extra letter or accidentally spelled something wrong in a key field, it's going to delay your return significantly because the ATO has to go through and manually match your details. And as you can imagine, this actually happens a lot. So the time delays, they're really substantial and you might be a little bit frustrated, but my friend, that is your fault. We triple check things in this house. Make sure that you claim all your income as well, including, as we mentioned

before, those like three Uber shifts that you did last October or that casual shift that you do at a cafe on the weekends in addition to your full-time job. Not claiming income is something that the ATO has been cracking down hard on for the last few years, especially with the rise of like the gig economy. So like stuff like Uber and Airbnb and social media influences and stuff like that. Like the social media influencer crackdown was like maybe four or five years ago. And I remember that went wild because as you guys know, I used to be a financial advisor and the amount of clients I had that were influencers, like let's be honest, that was my bread and butter. the amount of people that got audited that year was unfounded sure yeah like it wasn't unjust at

all but they were like hey you probably should be paying tax on these gifts and that's why things have changed a little bit in the last few years for good reason for very good reason because you shouldn't just be getting free stuff and just completely getting away with it especially if it's your job like if you get a gift that's very different than being given a product to promote Right. I don't actually use an accountant, but would you suggest that I do? It's totally up to you. So from my perspective, as I said before, if you're just a salaried PAYG employee, I think you can probably wrap your head around the MyTax portal. Like it is not too hard, Bec, I'm assuming you've been doing it yourself for the past few years and it's not something

where grab a cup of tea, sit down, like don't just try and rush through it. You know what? Have a wine. If you're going to have a wine, triple check, like just make sure all those details are absolutely correct and you're not a little bit wine happy. Maybe let's cap it at one glass of wine or like one per hour. It's like driving. Like if you're over the limit, you probably shouldn't be doing your tax. But there's a reason more than 75% of Australians use a tax agent. and that's because tax is not that simple and it can feel really overwhelming the tax portal over the last few years though has really upped its ante a lot of it is pre-filled a lot of it is automatic they already have your details they have your tax file number they have all of the

information that your employer put into the tax portal they have everything right so it's actually much easier than it used to be and obviously if you don't know exactly what you can claim it might be worth like talking to an accountant because you might be missing out on some pretty sick returns but if you get your return wrong you could also be in for some hefty fines so honestly it does pay to talk to someone if you're worried about it but more often than not i find especially having had what now five years experience with the she's on the money community i think that a lot of people if you sit down and have a good look at it you can pretty much do it yourself the only way to get definitive tax return advice though is from a registered professional. So an experienced

accountant, they're always going to be able to highlight to you what you can and you can't claim on and what you can be doing in the next financial year to really ensure that you're maximizing the amount that you can claim back. A good accountant is obviously an investment that can be worth making and you'll often find that they'll highlight things that maybe you didn't know you could claim. And the best part is that seeing an accountant is a tax deductible cost too. You could also just call the ATO and ask questions. You could ask questions in our Facebook group about what you're doing and how other people are claiming it. The ATO website is a really, really good resource. And it's in very simple terms, like type into the ATO search

bar, can I claim X, Y, Z, or how do I claim X, Y, Z? And there'll be tutorials on it. Like I promise these things, they feel overwhelming. But if you don't want to spend the money on an accountant, like my friend, you're probably smart enough to do it yourself. Like genuinely, I think it's worth a crack. Like, Bec, you could probably chime in here. Do you find it challenging? I don't. But now knowing what I know about, for example, not being able to just claim the $300 laundry thing without any tax receipts, that makes it a little bit more difficult. I know how to use it. That's called the MyTax portal, isn't it? Yeah, it is. On the MyGov website. Yeah. It's not too hard to wrap your head around. And if it feels overwhelming, it's probably because you've

never done it before and everything that we've never done before can feel really overwhelming. I would then also just say, look, if it's feeling a bit more complicated, like let's look at me, for example, like you guys know I have She's On The Money. I own a mortgage broking company, Zella Money. I, you know, do a million other things, which I actually have another business that, you know, if you see me on Instagram doing speaking events, that's not through She's On The Money. That's through another business. I own a property. My husband and I have recently bought an investment property, I do see an accountant because my tax affairs are a bit more complicated than the average bears now. And I'm so grateful to be in that position. And my accountant's not

that grateful to be in that position. He's just always like, Victoria, what have you done this year? Like, oh, I'm so sick of dealing with you. By the way, love you, Louis. Please keep listening to my podcast. I really appreciate it. But for people like me, seeing an accountant just makes sense because my tax affairs are complicated and there's a few businesses in the mix and there's a few different things. But as I said, if you're just a salary PAYG employer with like one stream of income, it's usually pretty easy to work out. And if you've been keeping track of your expenses over the year and like taking photos of things, or maybe you still operate on the shoebox method and you're chucking it in a shoebox under your bed, like it can be quite simple. Don't feel like

it's really overwhelming. And I mean, accountants, I adore you. I think you do a really, really good job. But at this point in time, I also think it's really worth empowering people to give it a crack themselves. Because one thing that I don't think people understand about accountants is as much as they are fantastic and they are the professionals and they're going to give you really good advice, at the end of the day, Bec, you're the one that signs your tax return. So if you still are claiming something that you maybe shouldn't be claiming just because you told your accountant that you did it, they're going to go, is everything true and correct? Bec, you sign this. It's not on them if the ATO comes back and says, hey, Bec, we need to audit you. You know, it's not a get out of jail

free card because you've used an accountant. Everything that you say and do can and will be used against you individually, if that makes sense. So just by using an accountant doesn't take the responsibility away. And I think that that's a very big misconception where you assume, okay, well, I'm not that good at it. And I do want to claim all those naughty things. I'm going to go to the accountant and say, I did do those things. At the end of the day, you're the one signing off on it. So if the ATO come back, it's on you. It's not on your accountant because they're going to turn around and be like, well, everything that Bec told us, she told us that was true and correct. And we just processed it based on the information she provided us with.

Yeah. They've done what they needed to do. They're not a safety blanket. They can be a safety blanket for like getting good advice and making sure that, oh, Beck, can I claim this? And you might go, oh, well, have you got the receipts? Yeah, I do. No worries. Oh, of course you can, Beck. It might give you that peace of mind. But I think reminding you that they're not the get out of jail free card might be another reason why you go, you know what, you're right, V, I'll just do it myself. And I mean, at the end of the day, just downloading the MyTax portal and putting all your information in and then not hitting submit, you can go see an accountant after that. Why don't you give it a crack? Give it a crack.

Give it a crack. See what happens. If it is overwhelming, then maybe go see someone. But if it isn't, you tried your best. It worked out. Yeah. That's actually a really, really good way to kind of explain it. It's not so overwhelming. Just give it a go. Just give it a go. And if you're really overwhelmed, don't hit submit. Go talk to an accountant. Exactly right. So that's my tax portal. Yeah. You don't need to like download any fancy software or anything. And obviously,

as I said before, the ATO can basically pre-fill most information from your employer and from banks and from government agencies and health funds and third parties by late July. So that's also a very common misconception that on the 30th of June, everything will be there. No, it was due on the 30th of June. Maybe it hasn't been processed or like input yet. So usually I would recommend if you're doing your own tax, wait until closer to the end of July, because then you have a lot more certainty that everything that you need to process your tax is already pre-filled. Makes your life easier, makes the process go a lot quicker. The ATO use a whole heap of range of systems and controls to protect your information. So it's all good if you're,

you know, putting your tax file number and stuff in. Make sure you are going to the legit website. There are a few websites, right? And I'm not going to name names, but if you type in my tax portal, double check, please, that it is the government website because there are a lot of companies that kind of leverage off that and call it like the my tax login or something and then they're actually a company that do your tax return for you and they'll charge you for that and you just have clicked on the wrong link. So just make sure it's the government one before we go and try and DIY. Obviously it's available 24 hours, seven days a week. So if Saturday night at 3am you can't sleep and you want to do your tax, what a time to be alive. You're going to

get your refund faster as well. So it's faster if it doesn't go through an accountant. Usually you'll get it back within two weeks or 14 business days. You can then upload records that you keep in the My Deductions tool to pre-fill your tax return, which is kind of sexy. Obviously it's available for all individuals and sole traders who want to lodge their own tax return. And you'll receive a very, very nice lodgement receipt by email to confirm that they have your lodgement once it's in and you can kind of track it from there. Awesome. I love that.

I think I love that too, but I'm really over talking about tax and I'm pretty sure you're overhearing about it. Yes, I am up to pussy's bow. Do you know what? With that, I think we're going to go. Guys, we'll see you on Friday. Bye, guys. The advice shared on She's On The Money is general in nature

and does not consider your individual circumstances. She's On The Money exists purely for educational purposes and should not be relied upon to make an investment or financial decision. If you do choose to buy a financial product, read the PDS, TMD and obtain appropriate financial advice tailored towards your needs.

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