Taxpayers missing out on easy cash with returns

Clients are often unaware of the items they can claim on tax and their ability to amend past tax returns, missing opportunities to gain “more cash in the pocket”, one tax depreciation expert says.

by | 30 Jan, 2017

BMT managing director Bradley Beer says clients are “absolutely all the time” surprised by what items they can claim on tax, particularly depreciation on aged properties, and are also unaware of their ability to amend two years’ worth of past tax returns.

“If you haven’t been claiming, you can actually go back and amend two years of tax returns. That’s where people go, ‘Oh, I didn’t think that old property gets deductions’ or ‘I didn’t know about this’,” Mr Beer said.

“The biggest one [people are unaware of is] old property still gets depreciation. People think that it only applies to new property [and] it only applies to young property. The simple thing is, don’t worry about the age, speak to the expert.”

Mr Beer said clients are too focused on claiming “little things” such as “dry cleaning”, and they often missed the “bigger”, more profitable items.

Clients need to be more proactive in seeking advice to better understand what items they can claim.

“We’re very focused on ‘Can I claim little things?’ when they miss sometimes things like [depreciation]. The average deduction out of properties for investments [was] about $10,000 last financial year. That diminishes over time but it’s still quite a substantial amount of money,” Mr Beer said.

“On an average deduction of $10,000, that would mean then $3,700 of cash in their pocket at the end of the financial year, which is maybe a better tax return than otherwise, at 37 cents a dollar.”

 

 

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