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Max Your Tax: 5 Ways to Use Your Tax Return

It’s that time of the year again. No, not the Ekka, but tax time !!!

30 June has come and gone and unless you lodge your tax return through a registered tax agent, all individual taxpayers are required to lodge their tax return with the Australian Taxation Office (ATO) no later than 31 October.

Did you know that around 14 million people lodge a tax return each year in Australia?

The ATO have reported that around two-thirds of Australian taxpayers receive a tax refund each year. Surprisingly, the average tax refund is around $4,000.

So if you are one of the lucky taxpayers who receive a refund, how should you spend it? Below are five smart ways to spend your tax refund.

1]  Buy Office Supplies and Computer Equipmentbusy office

Time to visit Officeworks or JB Hi-Fi. If you use your tax refund to buy office supplies, a new printer for your home office, a new laptop or i-pad or headphones for your Zoom meetings. Depending on your job, you may be able to claim a deduction (or depreciation) on these items. This way, you recycle your tax refund and are able to claim a tax deduction in next year’s tax return.

2]  Make a Tax-Deductible Superannuation Contribution

Contributions into your own superannuation fund are tax-deductible. However, in doing so, ensure that all contributions made during the financial year (including those made by your employer and salary-sacrificed contributions) do not exceed $27,500 for the 2021 financial year.

3] Donate to a Charity

Feeling generous? Why not donate that tax refund to your favourite charity? Donations to many charities are tax-deductible.

4] Enrol in a Short-Course or Webinarstudent sitting at a laptop

Amounts paid to attend a work-related seminar or webinar are usually tax-deductible as costs incurred in keeping up-to-date with recent developments to do with your job are usually tax-deductible. Once, again, recycle your tax refund into a tax deduction for next year.

5] Have a Holiday

Treat yourself. Go on, book a holiday or take your loved one for a romantic weekend away. Look, its not tax-deductible, but, hey, after what we have all been through over the past 18 months, you deserve it. You may even get some brownie points !!!

Investing in yourself is an excellent way to maximise your tax return.
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Note: The information contained in this article does not consider your personal circumstances, needs, objectives or financial situation.
This information does not constitute financial advice or taxation advice, and the general nature of the content might not be applicable to you or your situation. Before acting on any information contained within this article, you should seek professional advice. QUTeX is not an authorised representative of an Australian Financial Services Licence (AFSL).

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Stephen Marsden is a full-time lecturer employed in the QUT Business School where he is responsible for lecturing and tutoring a wide range of undergraduate and postgraduate financial accounting and taxation law subjects. Stephen has a Master of Business (Accountancy) and is a Member of Chartered Accountants Australia and New Zealand, CPA Australia, The Australian Institute of Company Directors and the National Tax and Accountants Association. He is also a Chartered Tax Advisor of The Tax Institute of Australia and a registered tax agent.

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