Should I do my own tax? Helping you decide to DIY.

I get asked from time to time whether its worth going to see an Accountant to do your tax.

It seems that the number of people lodging their tax returns on etax is growing, but I'm a bit concerned that people aren't claiming as much as they could. Some people may be incorrectly lodging tax returns, which can lead to the stress of audits.

Lets look a bit closer at some of the issues to help you decide whether or not to do your own tax.

Firstly, if your situation is really straight forward and your employer pays for everything and anything you might need for work (lucky you!), then you might not need to see an Accountant. BUT, if you answer YES to any of the below, then there are lots of areas where the assistance of an Accountant will help you get the maximum refund.

* Did you use your motor vehicle to travel anywhere else other than to and from your normal workplace? This could include such travel as seeing suppliers, clients, offsite training and meetings. Even if you don't have a logbook, you may be able to still make a claim for this type of travel.

* Did you travel interstate for work? The ATO has reasonable daily travel allowances which allow you to claim certain amounts without receipts!

* Do you have to wear a uniform or protective clothing? You can actually claim your laundry expenses of 50 cents per wash or $1 per wash up to $150.

* Do you do work related study? If you do, there are a variety of expenses to claim, such as the cost of the fees, printing, laptop, internet, parking, travel... the list could go on...

* Did you spend over $300 on a work-related equipment? This could include a laptop, ipad, tools. These can all be claimed if you use them for work, but there are special rules in claiming them.

* Do you work from home, use the internet at home for work, use a mobile phone for work, use your laptop for work? If so, you could be able to claim on all of these within the ATO guidelines.

There are many other areas where an Accountant can be of assistance. These are some of the areas where I generally find value in helping out Tax File Number (TFN) workers in maximising their deductions. There are strict rules which apply for claiming the above types of work expenses, so if you answered yes to any of the questions it would be worthwhile seeing an Accountant.

If you are an investor of some sort, whether that be shares, property or other types of investments or have business interests, than I highly encourage you to see Accountant to make sure you are maximising the claims and also lodging them correctly!

I would also recommend going with an Accountant that has been recommended by someone else and that is affordable - or an Accountant who actively blogs so you know they know their 'stuff' :)

I offer a fixed fee for my tax returns, with a standard individual tax return costing $99 (which is tax deductible on your next tax return). I'm certainly confident that all my clients are more than $99 better off after lodging their tax return through myself than if they were to have done their tax themselves.

If you do think you can manage doing it yourself, than I would highly recommend using the pre-fill option of etax rather than lodging by paper. Also, if you are lodging your own tax return you have until the 31st October 2012! If you use an Accountant, you generally get until the 31st March 2013 (but you need to contact them before the 31st October 2012 to get the extension)!!

Are your contractors really employees? A summary of the ATO guidelines recently released

The Australian Tax Office (ATO) recently released information helping businesses to determine if workers are employees or contractors. The ATO is cracking down on businesses using contractors to try 'to illegally lower their labour costs by avoiding their pay as you go (PAYG) withholding and super obligations for the worker'.

Penalties, interest and charges may apply for employers if the ATO finds that workers are engaged as contractors when they are really employees. The ATO also suggests "dobbing in" other businesses that may be treating employees as contractors.


Examining the working arrangement is key. Just because the worker has an ABN or business name, its the industry 'norm', is only needed for short-term or irregular work, have specialist qualifications or skills DOES NOT mean that the worker is actually a contractor, according to the ATO.
The ATO sets out typical aspects of a contractor working arrangement to include:

• they run their own business and provides services to your business,
• they can sub-contract/delegate or pay someone else to do their work,
• they are paid for a result achieved based on the quote provided,
• they provide all or most of the equipment, tools and other assets required to complete the work and they do not receive an allowance
• they take on commercial risks and are legally responsible for their work and liable for the cost of rectifying and defect in their work,
• the have freedom in the way the work is done subject to specific terms in any contract or agreement,
• the worker is operating their own business independently to your business and they are free to take on additional work.

If the worker is a contractor, the business also won't have Fringe Benefits Tax (FBT) obligations. Additionally, they may avoid other obligations such as occupational health and safety requirements, payroll tax, wages, conditions and leave entitlements.

Typical aspects of an employee working arrangement include:

• they work in your business and are a part of your business,
• they cannot sub-contract/delegate or pay someone else to do the work,
• they are paid for the time worked, price per item of activity or a commission,
• your business provides an allowance or their equipment, tools and other assets required to complete the work,
• they take no commercial risks and your business is legally responsible for the work performed by the worker and liable for the cost of rectifying any defect in the work,
• they are subject to control over their work and your business has the right to direct the way in which the worker performs,
• they are not operating independently from your business.

Below is a link to an ATO decision tool to help you determine whether your workers should be classified as employees or contractors.

http://www.ato.gov.au/content/00095062.htm?alias=employeecontractor

If you are after more specific advice, I recommend getting in touch with an accountant who understands these issues and is willing to discuss them with you.