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By Mark Chapman, Director of Tax communications, H&R Block
With Tax Time just around the corner, it’s vital that you claim deductions for everything that you’re entitled to.
It’s easy to miss many of the less well-known deductions. It's worth speaking to H&R Block to ensure you’re maximising your claims. In the meantime, here’s a hit list of some of the tax deductions which are often overlooked:
If you’re a member of a professional or trade association as part of your work, you can claim a deduction for the amount you pay in subscriptions. This also covers union fees if you’re a member of a trade union, as well as subscriptions to trade or professional magazines or – if you’re an investor – subscriptions to financial publications and other research services.
Don’t forget, if you prepay your fees or subscriptions for next year before 30 June, you can claim a deduction this year, which can be a useful timing benefit.
Most people with a rental property know that you can claim a deduction for the interest element of the mortgage but there are plenty of other deductions you can claim on a rental property, many of which are often overlooked. So, if you’ve paid out for any of these costs this year, make sure you claim a deduction:
Also, don’t forget to maximize your capital works deductions (basically, the depreciation on the building itself). It can pay dividends to engage a quantity surveyor to come through your property and assess the items you can claim. Often, your claim will be much higher than you thought, with items as diverse as swimming pools, fences and garden furniture all potentially qualifying.
If you paid for a tax professional (like H&R Block) to complete last year’s tax return, you can claim a deduction for the cost in this year’s return. Better still, you can also claim a deduction for any travel costs you incurred in getting to and from your agent. If you’ve paid for any tax advice during the year, that too is deductible.
If you pay for insurance premiums against loss of income, those amounts are tax deductible. But be careful; that doesn’t include life insurance, critical care insurance or trauma insurance. It also excludes policies paid for out of your superannuation contributions.
If you use your personal mobile phone for work – either to make or receive calls – you can claim the cost of these calls as a deduction. You can only claim business related calls so in order to work out the split between business and personal use, keep a diary for at least four weeks in order to work out the business use proportion. For example, if you have a $100 monthly mobile phone plan and you determine – based on your diary - that 25% of your calls are work related, you can claim a deduction for $25 per month, or $300 per year.
Similarly, if you use your home internet service to deal with work related matters, such as responding to work emails, you can also claim a proportion of those costs. Remember, keep a diary.
Calculate the tax refund you could receive after tax deductions with H&R Block's easy-to-use, accurate income Tax Return Calculator. Calculate your tax refund here.
We can identify exactly what you need to do to get into shape for the 2016 tax season and maximise your deductions.
This article first appeared on Yahoo7 Finance
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