Officeworks’ annual survey of 1,000 working Australians found that more than half are not taking advantage of their tax-time opportunity – with many failing to collect and lodge receipts for the returns to which they’re entitled.
Young Australians make up the majority of those failing to realise their tax potential, with 59% of 18-24 year olds and 45% of 25-34 year olds only claiming up to the threshold accepted without a tax invoice, instead of the actual amount incurred for the expense.
The research also revealed that Australians are in the dark when it comes to understanding what work-related expenses are deductible. Over a third (33%) are unaware that petrol can be claimed, 28% don’t know stationery is deductible and 34% consider costs associated with dry cleaning of uniforms as expenses that they can’t claim back.
Furthermore, only half of Australians are using tools such as the Australian Tax Office’s (ATO) mobile app or the ATO website as tax time resources – additional proof of Aussies’ end of financial year illiteracy.
Despite this, there is a clear desire from Australians to better understand their personal finances with over two thirds (69%) of respondents recognising that increasing their knowledge in the space could help them maximise their tax return.
85% of Australians feel the lodgement process could be simplified and better articulated. Meanwhile, 68% of those surveyed believe a tax agent would help them increase their tax return, but the cost of engaging one has been cited as the most common barrier for nearly half (47%) of Australians.
This lack of information and understanding around the opportunities tax-time presents has led to only 25% of working Australians being proactive at the end of financial year by purchasing key, claimable items that will not only maximise their tax return, but set themselves up for success in the new financial year.
Finance expert Justine Davies says, “It’s concerning to see such a high number of working Aussies failing to recognise the advantage of stocking up on work-related items before June 30.
“Being organised and implementing a sound tax plan from the beginning of each financial year is crucial in ensuring you’ll get back what you’re entitled to – particularly when you’re preparing your own tax return and unaware of the additional deductions and rebates available to you,” she said.
“The first piece of advice I give is to hold onto your receipts, scan a copy to ensure they’re comprehendible come June 30 and file them for safe-keeping.”
To help educate Australians on how to maximise their end of financial year opportunity, Officeworks has partnered with CPA Australia and Justine Davies to provide tax advice and guidance up until June 30, available at officeworks.com.au/happytaxplace