Two in five Australians (42%) feel stressed around tax time, according to research from business management platform MYOB. With the new financial year now in full swing, one accounting expert suggests now is the perfect time to put plans in place to alleviate this stress and prepare for a successful FY23.
“Preparing for tax time in July might seem extreme, but with increasing interest rates, household living costs and continued uncertainty for many across the country, having all the correct information to hand to make informed decisions and maximise your tax refund is something your future self will thank you for,” says Chris McComb, Small Business Accounting expert at MYOB.
The survey of 1,004 Australians found that for over a quarter (29%), tax time apprehension stems from the financial reliance on their refund and worry it won't be enough. This is particularly relevant now given the rise in cost of living, in itself a concern for 94% of respondents.
“Almost a third (30%) plan to use their refund to catch up on bills, so it’s important the process is as streamlined as possible. Speaking to an accountant or tax agent can help you submit an accurate claim with confidence and maximise your return,” Ms McComb said.
45% of people surveyed said they plan to use an accountant or tax agent to manage their tax, while twenty-seven per cent said they had used one in the past but will do it themselves this year. Almost half (45%) admitted to not knowing what they can claim on their tax return, an increase from similar MYOB research undertaken last year (38%).
“It’s clear that tax time causes concern for many Australians, and this is partly due to not having the knowledge or the proper systems in place that can greatly assist them during this period.
“Regardless of whether you complete your tax return yourself or enlist the help of an expert, it’s crucial to have an understanding of what you can and can’t claim so you can make informed decisions around your spending during the year,” added Ms McComb.
“For example, you can claim self-education expenses to upskill, and for those who work outside for prolonged periods you may even be able to claim a tax deduction for sunglasses.”
Ms McComb suggests the best way to keep on top of tax time is to implement a solid system to track expenses and receipts throughout the year, as well as capture how money is being spent, with claimable purchases highlighted.
“Business management platforms can be used to manage personal tax. These are particularly useful if you have several streams of income such as dividends or rental income on top of wages. They can automatically allocate transactions from your bank account, group expenses to show your spending and store receipts. But if you’re not ready for a platform with all the bells and whistles just make sure you have a system that works for you.”
MYOB is a leading business platform with a core purpose of helping more businesses in Australia and New Zealand start, survive and succeed. MYOB delivers end-to-end business, financial and accounting solutions direct to businesses employing between 0 and 1000 employees, alongside a network of accountants, bookkeepers and consultants. For more information visit myob.com or follow MYOB on LinkedIn.
About the research
The research was conducted by McCrindle Research on behalf of MYOB between the 5 and 11 May 2022. 1,004 Australian adults aged 18 and above participated in the survey.