Let’s face it. Tax time is unavoidable. No matter the working industry, taxes need to be addressed, and on time. To avoid making this process anymore strenuous, we have collated the top tax tips courtesy of our very own John Budrovich with relation to taxes for employees working in the Australian mining sector.
Tax returns for most industry sectors is fairly straight-forward. However, with high income earners such as contractors, or those working in labour hire roles, differing in work location, the average tax return may be a little more difficult. Individuals working in mining who receive a higher salary, may want to maximise what they can claim.
So, are you after an easier tax return process? Or are you seeking a few useful tips to make tax time a little more enjoyable? Read the top tax time tips John Budrovich detailed when answering a few questions for Australian miners.
Collect and summarise your receipts
To reduce your tax agent fee, collect and summarise your receipts. This means your accountant or tax agent won’t take up as much time collating and filtering through all of your receipts, minimising the time spent. Also ensure, as a mining site employee, you are well educated on what you are eligible to claim.
John Budrovich wrote;
“The Australian Taxation Office is tightening up on personal tax deductions these days, so what people might have assumed were standard deductions, or things they don’t need receipts for, while in the past you might have got away with it, now you can’t.”
In order to decipher your eligibility to claim certain travel and car deductions, confirm with your employer when and where your employment contract began. Then determine whether your travel expenses are being covered when completing your employment duties.
The Australian Taxation Office has an app where you can keep track of all your tax receipts. Go to the ATO app and use the MyDeductions function.
Please note there are certain restrictions and regulations with relation to your deductions. John explains;
“If you’re a contractor, there are additional deductions you can claim but there are also more specific rules around making sure you don’t claim more than you’re entitled to,” he said. “If you’re contracting through your own ABN, I definitely recommend you get an accountant involved (in lodging your tax return).”
Examples of Tax Deductions in the Mining Industry
- Travel Expenses
- Car Expenses
- Renewal of Licensing
- Tools or Equipment Used
- Accounting Fees
- Self-Education Costs
- Income Protection Insurance
John Discussed a number of factors and one should be cautious of with reference to tax deductions. He explained
“If you’re trying to do your own return and you have reasonably high deductions, then you better be able to back it up because you’re more inclined to get an audit from the tax office”
“The warning areas if you’re trying to do your own return are if you’re trying to claim your motor vehicle or meal expenses going to and from site, because the general rule is those things are not deductible.”
Tax Tips for Miners with Shares
There are a number of useful tips when referring to miners who also have shares, typically as a part of their retirement plan.
John noted, to again, collect and summarise receipts but with relation to shares purchased, shares sold and dividend received for the given financial year.
John also stated the importance behind distinguishing the difference between tax treatments for investing in shares in comparison to trading shares regularly.
When you are investing in shares, it can be tied into capital gains, where any gain is added to the income that is taxable. This further allows you to decipher the tax on the gain.
Time is also a factor when looking at capital gains. For example, if you have owned a share for 12 months or more before you sell, a 50% discount can be deducted from the gain (i.e. tax free). It is important to note however, you cannot reduce your taxable income by a capital loss.
Here at Aspect Accountants and Advisors Perth, we have a qualified and professional team that can further help you and any of your tax concerns.
Aspect Accountants and Advisors offer a range of financial services to Perth businesses. These services include:
- Business Consulting and Coaching,
- Tax Advice,
- Accounting and Compliance,
- Bookkeeping and Management,
- Self-managed Superannuation Funds.
For any further accounting or business development advice please give us a call and book an appointment at our West Perth accounting office.
P08 9227 9400
F08 6323 1111
A27 Cleaver Street, West Perth, WA 6005