How to Get a Bigger Tax Refund in 2025?

The last two years have been challenging for many Australians, with the cost of living increase affecting people nationwide. As a result, individuals may be seeking some relief and wondering if a larger tax refund could be on the horizon. However, it's important to note that therethere have been no significant changes to the tax laws for employees for the 2025 year, so if your circumstances are much the same as the 2024 year, your tax refund should be similar.

How do tax refunds work in Australia?

Over 14 million people lodge a tax return each year in Australia. Of those who receive a refund (approximately two-thirds), self-preparers received an average of $2,576 in 2022, while tax agent clients received an average of $3,550. This substantial difference highlights the benefits of seeking professional assistance in maximising your refund.

Choosing to lodge your return through an agent can also provide you with an extension beyond the usual October 31st deadline for self-lodgers. If you are not registered with a tax agent by 31st October and you are unable to lodge your return by this date, you may be liable to a late lodgement penalty.

If you've missed the deadline and want to minimise (or eliminate) any potential penalties, it is worth gathering your tax return information and heading to H&R Block. Our Tax Experts can prepare your return with minimal stress and provide expert advice tailored to your situation. The return typically takes approximately two weeks to process, and your agent can keep you updated on its progress.

Factors that determine tax refund amount

Several factors contribute to your tax refund amount, including:

• Taxable income from wages, salary, investments, rental income: You pay tax to the government each year on all forms of income, including wages, business profits and investment returns, and it can also apply to income from the sale of assets such as a property or shares. You don’t have to pay taxes on the first $18,200 that you earn, but anything above this will be taxed on a progressive tax scale, which means the percentage increases the more you earn.
• Tax deductions which can reduce the amount of your taxable income: There are various deductions that can effectively decrease your tax liability. Knowing which deductions you can legitimately claim for your occupation is also an important step to getting the tax refund you deserve.
• Tax offsets or tax credits: There are several tax offsets or credits accessible that have the potential to lessen your tax liability. One of these is the seniors and pensioners tax offset.
• Medicare Levy Surcharge: If your income exceeds the relevant income threshold and you do not have an appropriate level of private patient hospital cover for the full year, you will be liable to pay the Medicare Levy Surcharge. To avoid the surcharge, you must have the appropriate level of cover.
• Residency Status: Your residency status for tax purposes can affect the tax you pay and amount of refunds you are entitled to. 

While these are some key factors, there are many others to consider. For lesser-known deductions, consulting with H&R Block can ensure you're making the most of your claims.

How can I maximise my tax refund this year?  

• Phone and Internet Services
• Charitable donations
• Work-related car expenses
• Work from home deductions
• Costs of education related to current job.