CALL US: (07) 3367 0999 | EMAIL US:

Avoid these five common Tax Time mistakes

Tax Time is now upon us, with the ATO Assistant Commissioner announcing the top five mistakes commonly made when Australians complete their annual tax returns.

Common mistakes some taxpayers are making include:
– Leaving out a portion of their earnings, i.e., forgetting to include a job – income from a temp job, or income earned from the sharing economy.
– Claiming personal costs for rental properties, i.e., claiming deductions for periods when they were using the property or claiming interest on loans used to buy personal assets (a car or a boat).
– Making claims for expenses unrelated to their employment, i.e., personal phone calls, work to home commute or buying normal clothes.
– Claims for things they have not paid for.
– Not holding onto receipts or keeping insufficient records of their expenses to validate their claims.

To avoid making common errors, the Tax Office is reminding individuals to:
– Remain up-to-date with what you can and can not claim.
– Keep detailed records.
– Ensure you declare all your employment earnings.

Business
advice

taxation
planning

compliance
services

News

Tax on super death benefits for dependants vs non-dependants

July 9, 2020

A super death benefit is the super paid after a person’s death, usually to a nominated beneficiary. These benefits are subject to different tax treatments, depending on whether the beneficiaries are dependant or non-dependant.

Superannuation death benefits will generally be received tax-free by tax dependants, who are considered to be:

Dependants will not have to pay tax on the tax-free component of their super in the event that they:

However, they will be taxed at their marginal rate if they receive a capped benefit income stream and:

Not all super death benefits are subject to tax; for non-dependants, there is a taxable portion. This component is largely made up of after-tax super contributions that the deceased member has made.

Super death benefit payments are subject to tax when:

Non-dependants must calculate how much money in the super account is a:

The amount of tax non-dependants pay will be based on their marginal tax rate, however, this amount may be reduced by tax offsets. For the taxed element of the taxable component, the effective tax rate is your marginal tax rate of 17% (whichever is lower). For the untaxed element of the taxable component, the effective tax rate is 32% or your marginal tax rate (whichever is lower).