Top Considerations When Lodging Tax Returns Online

The private health insurance rebate is income tested. This means that if your income is higher than the relevant income threshold, you may not be eligible to receive a rebate. Your rebate entitlement depends on your family status on 30 June and the age of the oldest person on the policy. Different thresholds apply depending on whether you have a single or family income and what your income for surcharge purposes is. In some instances you may have overclaimed your rebate already throughout the year on the cost of your policy and the difference will be balanced by the ATO on your tax return.

As a result of the introduction of indexation of the Australian Government Rebate, Premiums received before 1 April are reported with a benefit code of 30,35 or 40. Those received on or after 1 April are reported with a code of 31,36 or 41.

The benefit claim code is listed on the Private Health Insurance statement and indicates which offset percentage (based on the oldest policyholder’s age) is applicable to the taxpayer and when the premium was paid.

In order to be eligible for this offset, you must have lived within one or more recognised zones for 183 or more days during a single year, or over two consecutive years. You may also be eligible if you have been living in a zone continuously for up to 5 years, and in both the first and last year you did not meet the required number of days to be able to claim the offset, but if you combine the time spent in the zone in the first and the last year, it comes to more than 183 days. In this case you will claim the zone offset in the last year. Eligibility is based on your usual place of residence (so does not apply to Fly In Fly Out workers). The amount of offset you can claim depends on which zone or area you lived in, and whether you were part of an overseas force. If your time was divided between zones and areas, you would typically claim your offset for the zone with the highest fixed amount you did not spedn 183 days or more in that zone. In that case, you would favor the percentage of time spent in the highest offset zone and base the larger part of your total offset on that zone. This offset is increased if you have dependant childrenm, are a sole parent or are also eligible for the invalid & invalid carer offset.

Pay As You Go (PAYG) instalments refers to a system for making regular payments towards your expected annual income tax liability. It only applies to you if you earn business and/or investment income over a certain amount.

Medicare Levy Exemptions apply to:

• Category 1: members of the defence forces who are entitled to full free medical treatment under defence force arrangements, full-time members of the defence force reserves (for days in continuous full-time service), a person who is entitled to free medical expenses under Veteran’s Affairs (gold card holders), a person who received sickness allowance from Centrelink (for the days receiving the benefit), Note: New claims for sickness allowance ceased from 20 March 2020, and a person who qualifies as a blind pensioner – who hold a non-income tested health card
• Category 2: a person who qualifies as a non-resident for tax purposes
• Category 3: holders of a certificate from the Medicare Entitlement Statement Unit of Medicare Australia showing that the taxpayer is not entitled to Medicare benefits.

You may qualify for the Half Levy Exemption if:

• You were in exemption category 1 and you satisfied either of the following conditions:
• You had at least one dependent (for example, a spouse) who was not in an exemption category and who did not have to pay the Medicare levy (for example, because they were a low income earner).
• Your spouse was in exemption category 1 and you and your spouse had a child who was a dependent of both of you and was not in an exemption category. In this case, either you or your spouse can claim a full levy exemption and the other can claim a half levy exemption.

You are an excepted person (if under 18 years of age) and will be taxed at normal resident rates if any of the following applies to you:

• You were working full-time or had worked full-time three months or more in the tax year (ignoring full-time work that was followed by full-time study)
• AND
• were intending to work full-time for most of the tax year and not study full-time.
• You were entitled to a disability support pension or a rehabilitation allowance, or someone was entitled to a carer allowance to care for you.
• You were permanently blind.
• You were disabled and were likely to suffer from that disability permanently or for an extended period.
• You were entitled to a double orphan pension and you received little or no financial support from your relatives.
• You were unable to work full-time because of permanent mental or physical disability and you received little or no financial support from your relatives.

Eligible income is an income that is not excepted income. Special rules apply to persons under 18 years of age, and are not an excepted person, who earn eligible income. If you are not an excepted person, some or all of your income may still be classified as excepted income and will be taxed at ordinary rates. Your excepted income is generally income that you earned from working. Trust income and other "unearned" income (e.g. interest, dividends, or capital gains received from a gift) are NOT considered to be excepted. To calculate excepted net income, determine the sum of the following types of income:

• Employment Income
• Taxable pensions or payments from Centrelink or the Department of Veteran's Affairs
• A compensation, superannuation, or pension fund benefit
• Income from a deceased person's estate
• Income from property transferred to you as a result of another's death or family breakdown, or to satisfy a claim for damages for an injury you suffered.
• Income from your own business
• Income from a partnership in which you were an active partner
• Net capital gains from the disposal of any of the property or investments referred to above
• Income from investment of amounts referred to above
• Then, subtract any deductions relating to the income. The remainder is your excepted net income.

Other income (called eligible income) may be subject to higher tax rates.

As you were under 18 years old on the last day of the income year (30 June), you must complete this section or you may be taxed at a higher rate than necessary.

Under 18 > How much of your net taxable income of $[0.00] is eligible income?

Some or all of your income may be excepted income. This means it is taxed at the same rates as if you were an adult. Your excepted income includes your employment or business income, Centrelink payments, compensation, superannuation or pension fund benefits and income from a deceased person's estate. The remainder of your income is eligible income.