As the financial year wraps up on June 30, many Australian taxpayers are eager to lodge their tax returns in July, hoping for a quick refund. However, rushing to submit your tax return as soon as possible may not be the best strategy. Here are several reasons why you might want to consider delaying your tax return lodgement.
Incomplete Information
One of the main reasons to hold off on lodging your tax return in July is the potential for incomplete or inaccurate information. By early July, many third-party providers, such as employers, banks, and health funds, may not have finalized their reporting to the Australian Taxation Office (ATO). Lodging your return too early increases the risk of omitting crucial details or including incorrect figures, which can lead to processing delays or the need for amendments later on.
Avoiding Amendments
Amending a tax return can be a tedious process, often resulting in additional paperwork and prolonged waiting times for your refund. By waiting until August or even September, you can ensure that all the necessary information has been reported to the ATO and pre-filled in your return. This minimizes the chances of errors and reduces the likelihood of having to submit an amendment, saving you time and hassle in the long run.
Maximising Deductions
Taking your time to lodge your tax return also allows for a thorough review of potential deductions. Rushing the process may cause you to overlook eligible deductions, such as work-related expenses, charitable donations, or investment property costs. By giving yourself ample time, you can gather all relevant receipts and documentation, ensuring that you claim every deduction you’re entitled to and potentially increasing your refund.
Professional Assistance
Tax agents and accountants are often swamped with clients in July, making it difficult to get an appointment or the level of attention your return might require. Waiting until the initial rush subsides in August or September can give you better access to professional advice, ensuring your return is accurately completed and optimized for deductions. Additionally, tax agents are more likely to be up-to-date with any new tax laws or changes implemented by the ATO, which can further benefit your tax outcome.
ATO Processing Times
While lodging early might seem like a way to get your refund faster, the ATO’s processing times can be longer in July due to the high volume of returns submitted. By waiting a few weeks, you may actually receive your refund faster, as the ATO’s workload begins to stabilize.
Conclusion
While the temptation to lodge your tax return in July for a swift refund is understandable, taking a more measured approach can have significant advantages. Waiting until August or September allows for the accurate completion of your return with all necessary information, maximizes potential deductions, and provides better access to professional advice. By delaying your lodgement, you can avoid amendments, reduce stress, and potentially receive your refund more quickly once the ATO’s initial rush has passed. For a smoother and more beneficial tax return experience, consider postponing your submission until later in the year
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