Thursday, June 9, 2011

Tax Time

This week I'm starting to get organised to deal with the dreaded Tax Time. Is it just me or does this time of year give everyone the jitters? And I don't even do my tax return myself, both Shane and I take ours to an accountant. It's just one of those paper-work things that I can't stand doing.

We have taken our tax to an ITP office for the last 2 years and I find them wonderful. It does cost, but they take their fee out of the return. They also know all the tricks of the trade to get the most out of my tax return, claiming this and that- things I never would have thought of myself. Even if it costs me about $200 to get my tax done (small business), I still make a profit due to the return I get. Yes I could spend the time to learn how to properly do my own tax return, but honestly I have better things to do and I'm just not interested in accountancy!!

Shane's returns, on the other hand, aren't so predictable. Sometimes he gets a good return, other times he has had to pay tax. I have no idea why there's such a big difference from year to year, but it has something to do with him working in hospitality. We have a little money set aside that we could use for a tax debt if it comes to it, but I really hope this year we won't have to. That money will be much better staying put growing interest, for an emergency; or if we need to buy a new car; a house deposit; or maybe a holiday one day, who knows?

Those of you who came from Rhonda's blog (thanks! :)) will know that Shane and I had planned to go over- seas after our wedding, and were planning to be in Spain at about this time. Obviously pregnancy wasn't exactly on the travel agenda; Peanut was of course planned in our future, but his timing wasn't exactly planned :) SO we've had to put the travel plans on hold, for now. I know that we will still get there, to my Dad's house in Spain, to the UK where my sister lives, and to Germany to see Shane's extended family. But we are just over-joyed at the slight detour in our plans; we couldn't be happier or more excited :-)

Sorry- I always go back to Peanut- even in a post about Tax!! Haha :-)

Back to the Tax. I use those cardboard concertina cases for our paper work such as payslips and previous tax returns, receipts etc, so that I know where everything is when it comes to Tax Time. These are cheap- about $8 from Big W or K Mart. I label the compartments inside, and also put a year label on the front. Shane's payslips are all in there (he gets his in paper format- so old fashioned! BTW he also gets paid with a CHEQUE- can you believe his boss??)



My invoices/receipts from my organising jobs are all stored in folders on my computer. I haven't had to show them yet to the accountant, but they are there ready to be opened, when and if it is required. I always take in to the accountants our previous tax returns from last year as well, in case they want to see those. I've also done quite well with my book-keeping, keeping track of hours worked and every dollar I earnt etc, and all my expenses. I take the book in and the accountant praises me on my organisation :-D I love the little slap on my back!

The worst thing for me is the waiting for Shane's group certificates from previous jobs. I am hoping they will be posted to us promptly this year so I can book in our appoinmtent with ITP as soon as possible. The sooner it all gets done, the sooner I can relax and not think of tax for a whole year!!

How do you deal with your tax return? Do you do yours yourself, on time, or a few months late...or will you pay someone else to do it for you like I do?

12 comments:

  1. I always do our tax returns myself. We have to file a federal return and because Shane works in both Missouri and Kansas in the course of a year, we have to file both Missouri and Kansas returns. We have several deductions we can claim, so I always do the long form.

    If we qualify (based on income), I will use something like TurboTax online to file for free electronically. Even if we don't qualify for free filing, I will use it to check my own work, then just send my hand-filled forms myself.

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  2. Dear Sarndra, thank you for your blog. We immigrated 2 decades ago and the first year I did the tax return myself. We had to pay in a large amount which discouraged me quite a bit. We since have a tax consultant do our returns and she gets us quite an amount back each year. We do pay less for this service though, about half of what you pay. May all go well with your pregnancy. Best regards, CW

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  3. Teeeheee this is one of those things I honestly hate BUT am actually good at. I do my own return and when I actually sit down to do it, it takes about 10 minutes. Seriously.

    D always pays other people to do his - this is not his "gift" and he'd rather pay and have it off his mind.

    We took one last pre-babies trip (totally on a whim - one week talked about, next week we were on our way to DUblin) when I was 23 weeks pregnant. I don't recommend flying at that stage with twins - it was not pleasant but I'm still glad I went :)

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  4. I fill in a Self-Assessment return but that's only been required for the last three years (since we started renting out a property - the money from that means I am now treated as being self-employed).
    I dread, dread, dread the process but I find that once I sit down and pull all the stuff together, it takes less than an hour. I can do it online so it's fairly easy as boxes only open up if you need to fill them in and red writing and exclamation marks appear if you do something wrong. I tend to fill it in then leave it for a month then go back and re-read to see if anything seems wrong to me. I earn so little that I am below the tax threshold anyway...

    My husband is a sailor so his tax is a nightmare - we pay a Marine Tax Specialist to do his and it is worth EVERY penny, believe me.

    Karen (Scotland)

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  5. Here in the U.S. our taxes are done before April 15th...but as You successfully have shown I also use a file system to keep track of tax documents through out the year...less stress!!
    Keep the posting the "peanut" comments !!!
    ~~HUGS~~
    http://blessingtheelements-mi.blogspot.com

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  6. I usually do them myself with eTax through the ATO, it really is simple and walks you through all the steps and we always get a return. But I think I don't claim enough deductions and this year I was self employed for 6 months, plus did some studying, so I am pretty tempted to go to a specialist this year.
    I also do keep everything organised and I often have submitted taxes by mid-July - the sooner the better when you are getting a return!

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  7. I do my tax and SJ's, as our returns can be somewhat unpredictable and having to pay an accountant to do it just isn't worth it if it's only going to be a small return. Each year I discover something new I can claim, thanks to working with business accounts and having regular contact with an accountant! It usually takes me an afternoon to get it sorted, and I submit it online using e-tax as returns are processed much quicker this way. I try to keep our records in order, which makes it a little less stressful, but I don't think it too much of a chore since it only happens once a year.
    ~S.

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  8. I've done my husband's for most of the 9 years that we've been back in Australia. Before I met him he was a single coal miner and used to get substantial returns every year thanks to spending $ on tools and things like the rural location offset. We've been in a city most of the years that we've been together, and with a family now, he doesn't spend as much money on work things (despite getting a tool allowance each week). He also doesn't get nearly as much in his tax returns which he started to suggest was my fault :-O !!! He paid an accountant one year, convinced it was me who was wrong. We drive 2.5 hours to an accountant recommended in Mackay, paid $180 to get his return done, then drove home again. I had already worked through eTax on the ATO's website and had come up with my own estimate but not submitted it (you can save them and keep adding to them before submitting). The accountant got him about $60 more than my estimate, and he'd paid $180 for the privilege, not to mention 5 hours of driving/fuel! I thought it was hilarious :-P The fee is tax deductible the following year, but you only get a small percentage of it back, of course, meaning that it just wasn't worth us paying for an accountant, assuming I'm always that accurate!

    We have a large 2-draw timber filing cabinet with all of our family's paperwork in it. There is only one folder in there for tax, and DH puts one of those plastic A4 sleeves in each year with "10/11" etc written on them. He adds all of his receipts to that each year, plus his group certificate and finally his Notice of Assessment. When I do his return I just have to work out our internet access bill (for the education tax rebate) and add up his receipts. ETax prefills data such as Medicare out of pocket expenses, so I don't both going to them to ask for a statement any more. We never go over the threshold anyway, so can't claim anything there! I use internet banking to access our interest earned for the financial year. So everything is very close to hand, thanks mostly to DH adding receipts as they come to his plastic sleeves in the filing cabinet. I wish everything could be as organised as his tax return to be honest! I find dealing with electricity and phone companies far more complex than eTax!!!

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  9. I've never paid to have my return done, have always done my own, on the old paper forms, and the past few years using eTax. Also do DH's. My return is quite simple, the trickiest thing is claiming the dependent spouse offset (which isn't difficult, but unfortunately I didn't know about it the first 2 years we were together). Last year I could also claim the medical expenses offset due to DH's dental surgery costing so much, compounding with his usual prescription medicine costs.
    DH's tax return is even easier, only need to input his income of a little bank interest and his share dividends (from when his credit union listed and gave members shares) and he gets his franking credits back as his return. He was well chuffed the first year he got that back. Being unable to work the last thing you expect is a tax refund :)

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  10. As a tax accountant, I can let you in on a secret. I am not super organised with my paperwork. I know they are in one spot, and I spend one day a month sorting through my mail in-tray for filing. When you are doing tax returns all day, all year, the last thing which does not inspire me is doing this for my spare time.

    I do think that $200 is quite a good price for a small business. Generally, accountants are like lawyers (but nowhere near expensive), and accounting firms have a set charge rate per hour. The time it takes to do the tax return would depend on how much or little information you give us.

    There are several items which could be of help to you:

    1. When you do your tax return through a tax agent, they have access to ATO reports which should list your group certificate income and tax paid, provided the employer did not give you a manual group certificate, and did an electronic one.

    2. Interest details are generally picked up for the year in the same report. Otherwise, use the last bank statement for the financial year - somewhere down the bottom will tell you the total interest earned for the year.

    3. Depending on how legislation goes, the ATO may give taxpayers a blanket deduction threshold. I cant remember how much but it was around $1-1.5K but this will depend on legislation being passed. This might eliminate the need to keep receipts, if you know you are under that amount, you could legally claim up to that amount.

    A tax agent has staggered due dates. We do taxes all year round. Whilst most people on etax have to lodge by 31 October, I find myself busy even this time of the year as well.

    Good luck with your tax efforts. Hang in there. It does have to be done unfortunately ... :)

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  11. Thanks so much everyone for sharing your fantastic systems- you all sounds like real pro's! I love this about blogging- the comments are such a great addition!!
    Xox

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  12. It’s always a good choice to let your accountant handle your tax returns. Though I have an accountant too, I still try to learn and familiarize myself about the whole process. Also, file your taxes ahead of time to avoid the last minute rush, which will cause you nothing but hassle.

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