When is tax time in Australia and how to prepare

Tax time is an important period for all taxpayers of Australia because it’s the time when individuals and businesses are required to report their incomes and other financial details to the Australian Taxation Office (ATO). This will help the government acquire the financial resources needed to fund public services and infrastructure.

But when is tax time? In this article, we’ll break down the key dates, what you need to prepare, and how to get the most out of this yearly obligation.

When does tax time start and end?

In Australia, tax time for individuals runs from 1 July to 31 October each year. This aligns with the Australian financial year, which begins on 1 July and ends on 30 June the following year.

Unlike the calendar year (January to December), the Australian financial year can be a bit confusing, especially for newcomers or first-time lodgers.

• 1 July to 30 June – This is the official financial year period.
• 1 July to 31 October – This is the time window in which individuals must lodge their tax return for the previous financial year.

Understanding these key dates is important for individuals and businesses alike. While 31 October is the deadline for personal tax returns, other due dates apply depending on your circumstances—particularly if you’re self-employed, a business owner, or using a registered tax agent.

1. Individual taxpayers (lodging via myTax)

Most of the people lodge their tax returns easily and with no hassle because the process is simple, and they can lodge it online by using the ATO’s MyTax system. MyTax lets people lodge their returns quickly and easily, and it is available for those with simple tax affairs.

Deadline for Filing a Return: The deadline for filing of a return by a taxpayer is 31 October. If you file your tax return manually (that is, on paper), then it needs to be lodged with the ATO by that date.

2. Using a tax agent

If you want to lodge your return through a tax agent, you have a bit of more time. Tax agents are professionals who can prepare your tax return for you. They can make sure you claim all the deductions and rebates that are available to you. If you use a registered tax agent, he or she may be able to lodge your return after the usual deadline of 31 October.

• Deadline for lodging through a tax agent: If you lodge your tax return through a registered tax agent, you may be eligible for an extended deadline. The date will depend on when the agent registers you as a client. For most business taxpayers, lodging may be extended until May of the next year. You must, however, register with a tax agent before 31 October if you wish to lodge an extension and be assured of it.

3. Business taxpayers

For businesses, tax time involves lodging a Business Activity Statement (BAS) and other financial reports. Depending on your business structure—sole trader, partnership, or company—requirements and deadlines may vary.

Quarterly BAS lodgement deadlines:

• 1st Quarter (Jul–Sept): Due 28 October
• 2nd Quarter (Oct–Dec): Due 28 February
• 3rd Quarter (Jan–Mar): Due 28 April
• 4th Quarter (Apr–Jun): Due 28 July

Annual tax returns for businesses: Businesses must lodge an annual tax return. If your financial year ends on 30 June, the return is typically due by 28 February the following year (if using a tax agent, it may be extended).

4. Superannuation and fringe benefits

All businesses are also expected to report contributions made towards superannuation and fringe benefits. Reporting deadlines are also essential since missing them will incur penalties.

• Superannuation contributions: An employer must pay his employees’ superannuation contributions not later than 28 October each year.
• Fringe benefits tax (FBT): FBT is lodged by businesses in late March, with 21 May as the payment deadline.

Important information for tax time

When tax time rolls around, it’s time to gather documentation and be sure you are fully prepared to lodge your tax return. Here are some key things to remember as you approach tax time:

1. Income documentation

Among the most crucial steps of preparing your tax return is ensuring that all your income is reported correctly. For an individual, one would want to have records on salary or wages earned, income from investments, business earnings, and government benefits. The common ones include:

• PAYG summary (Payment summary): In case you are employed, your employer is supposed to give you a PAYG summary detailing how much you earned and the amount of tax withheld.
• Bank statements: If you have income from investments or savings, bank statements will be necessary.
• Government payments: If you received some form of government benefits-e.g. Centrelink-scan and attach your payment summary for those as well too.

2. Deductions and offsets

Tax time is a good opportunity to claim various deductions and offsets that can reduce taxable income. Some of the items might include:

• Work-related expenses: If you are an employee, you can claim deductions for work-related expenses like uniforms, tools, and travel.
• Self-education expenses: If you are studying or training in relation to your work, you may be able to claim these costs.
• Charitable donations: Support provided to registered non-profits can be claimed on your taxes.
• Health insurance: If you have private health insurance, this could reduce your tax liability.

3. Tax offsets

Some individuals may be eligible for tax offsets, such as the Low and Middle-Income Tax Offset (LMITO). These are usually applied automatically by the ATO based on your income level and eligibility.

Conclusion

Tax time in Australia marks one of the essential events in any financial year as deadlines run from 1 July to 31 October. Yet, these deadlines are determined according to the purpose for which a person lodges his tax return an individual or a business, and also if the lodging is being carried out by a tax agent. This helps prevent penalty payments from arising in cases of non-compliance. Proper documentation and identification of eligible deductions also facilitate easy preparation.