Individual Tax


Personal Tax Matters


Deductions / Offsets

Claims for deductions need to be supported by receipts, which can be kept for easy reference in a monthly organiser file. A deduction is a subtraction from assessable income, from which the income tax is calculated. Rebates (now called offsets) are deducted from the tax already calculated.

Therefore, a one-dollar rebate is of more value than a one-dollar deduction.

Private Health Insurance

An additional 1.5% Medicare levy surcharge is payable by individuals with taxable incomes in excess of $90 000 for couples / families with a taxable income of $180 000 who choose not to pay for private health insurance.

Salary Packaging

Salary packaging is a series of arrangements that allows an employee to use some of their income prior to tax to pay for benefits (e.g. health insurance, car repayments). This reduces the overall tax payable on the employee's salary effectively increasing the net value taken home. It can be extremely effective where the employee is paying tax at the highest margin.

Motor Vehicle Travel

Vehicle travel to & from your place of employment is not allowable as a tax deduction unless carrying bulky tools & equipment.

If a taxpayer does not carry tools & equipment but must travel from location to location for work purposes, a deduction is allowed from the first port of call to the last. However, travel to & from the original workplace, however long, is not deductible.

Worthless Shares

If you have purchased shares that, for varying reasons (E.g. company collapse, price drop) have become worthless it is wise to get rid of them and establish a loss.

In the case of company / business liquidation an announcement may be made that there is no prospect of a return to the shareholder. The shares are then treated as if they were sold and reacquired at nil cost.

Multi-level Marketing Losses

Losses from Multi-level marketing and other small business activities, with a turnover of less than $20,000, are not deductible from taxable income.

These losses are now referred to as non-commercial losses and are deferred and offset only against future profits.

These provisions do not relate to:

  • Negatively geared investments
  • Contests
  • Farmers

NOTE: Investments in Rental Properties. Rental Property Deductions - If you have a rental property less than 10 years old. Please get a report from the quantity survey. It makes a huge difference to your negative gearing.