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Individual Tax Returns

It is common for professionals who offer services to trade under a different entity for the business, whether it's a trust, partnership or an incorporated company.

The charm obviously being the lower income tax rate these entities offer, as opposed to the top marginal income tax rate of 47% that an individual would pay.

Operating a business through this type of structure also can result in a broader array of tax deductions being available. To prevent taxpayers avoiding their full share of income tax, the tax legislation, however, has some regulations in place. Contact our expert Cranbourne Tax Agents for more information.

The PSI Guidelines

The measure comes under the banner of "personal services income" (PSI), which describes PSI as payments for "a reward for a person's individual efforts or skills". This excludes the sales of merchandise, like a retail store or manufacturer, or using physical assets such as a truck or van to derive that income.

As PSI is revenue generated primarily from personal expertise or efforts, you can derive PSI in numerous sectors, trades or occupations. Typical cases include building & construction personnel (such as trades), financial professionals, IT professionals, engineers and medical professionals.

The PSI guidelines operate as an integrity measure in order to avoid people employing an entity to direct their earnings to a lower tax setting (for instance a company) and also to gain access to a greater suite of general tax deductions.

If a business structure is assessed to be contrived (an evaluation that is based on a number of checks), then the revenue your business generates is going to be treated as earned by you as a contractor individually, and subject to taxes at the individual rate instead of taxed to the entity.

The income tax issues that accompany PSI are sometimes misinterpreted and may lure the unwary in case the ATO's auditors come knocking.

The ATO's PSI Tool

To make issues simpler, and also to assist with your income tax planning for the year ahead, contact us on 1300 300 106 about accessing the ATO's recently designed online "decision tool" to help you determine whether have earned PSI, and when the PSI principles will affect that income.

In order to answer the questions in the PSI determination tool you will need:

• specifics of contracts with the business's clients in the financial year

• invoices for work done in the financial year

• details of payments to your staff or sub-contractors.

What this PSI tool provides

After answering a number of questions, the tool provides you with a report that provides you:

• advise on whether your revenue is PSI and if the PSI principles affect you

• a review of the answers you've supplied

• information about the implications on your tax obligation as per the result provided by the tool.

The ATO states that generally you'll be able to rely on the results provided by the tool, however, based on your scenario; you can make application for a "personal services business (PSB) determination".

You can print or save the report, for your tax records. Our skilled Tax Agents & Accountants in Cranbourne can help you examine the outcome to assist you strategise your income tax affairs.

For further information about BookSmart Accountants Cranbourne or tax agent services, please contact us on 1300 300 106 or via our contact page.


Identity Theft: The Taxman Can Help!

The risk these days of identity fraud is extremely real due to which the ATO provides a Client Identity Support Centre (Click Here) to assist taxpayers who may have had their identities compromised or misused.

The ATO states that it is going to give every guidance it can, and will offer information, facts and assistance to help individuals re-establish a stolen identity. If individuals think their tax file number (TFN) might have been affected, they are encouraged to contact the support centre on 1800 467 033 (8am - 6pm Monday - Friday).

Compromised TFNs

Your TFN is required to identify you with your dealings with the ATO. In the event you have dispose of or recycle any data or any other papers, the ATO’s suggestion is to always destroy or erase your TFN from all of these files beforehand, since the TFN along with other personal data may be used to lodge income tax returns as well as other tax forms.

The very first step is always to make sure that you haven’t merely temporarily misplaced your TFN, instead of presuming it may be misused. And watch out for any signs that suspicious activity might be underway. For instance, inform the ATO in case you have received a notice of assessment in regards to a tax return you have not yet lodged.

If your TFN is compromised, the initial steps the ATO is going to take is to re-establish and verify your identification with you as well as verify your tax records. Other measures will be determined by your circumstances and situation.

Re-Establish and Verify Your Identification

You may have to re-establish your identification by supplying the ATO with evidence — this might include things like specifics of private information, like your birth date, postal and physical address, bank-account details, or TFN in case you have that listed elsewhere. You might also have to supply the Tax Office with details sourced from identification documents, say for example a prior notice of assessment you might have filed aside.

“We may possibly request original or certified copies of your identity, based upon your circumstances,” the ATO stated. “If you've established a secret question and answer with us, we might request that information as a part of course of action to re-establish your identification.”

After original or certified copies of paperwork have been provided to the ATO, it will require to verify the credibility of the identity documents, which might take a few weeks.

Examine Your Tax Information

After your personal information have been verified, the ATO will examine your tax records by checking out:

  • TFN declarations,
  • Income tax returns (earnings reported, bank accounts used, tax agents engaged as well as other information),
  • Australian business numbers (ABNs) – any application lodged or the use of ABN, and
  • Employer superannuation guarantee payments made.

The revenue collection bureau could request you to verify the data on record so that it can establish which activity is yours, and which are those from someone else who might be working with your TFN.

The duration of the investigation may vary based upon the extent of information that is on file, whether or not someone else has in fact used your TFN, and just how straightforward it is to verify credibility.

Feel free to contact Tax Accountants Cranbourne on 1300 300 106 for further information.

Dont Get Caught Out!!!

Tax Office has advised Tax Agents that it is increasing the focus on the investment property deductions in 2015 Tax Returns. Investment-property

ATO will be paying extra attention to the excessive tax deductions claimed especially for holiday homes. ATO has identified that deductions are not being properly apportioned where the property was not available for rent for the whole year.

ATO will be running a campaign to educate property owners about what they can rightfully claim. ATO will be sending letters to investment property owners in holiday locations providing them with guidelines for the deductions.

Common deductions that are being claimed incorrectly are interest, rates, utility expenses, insurances, depreciation etc.

Don’t get caught out! Please ensure that you only claim deductions for your holiday homes for the period it was actually available for rent.

Call one of our expert accountants Cranbourne or tax agents Cranbourne at 1300 300 106 to ensure you are claiming the right amount, no more, no less. Stay out of hot waters with the Tax Office.

If you earn a salary you probably do. You must declare all your income but you can also claim your work-related expenses.

The complete details pertaining to who must lodge a tax return can be found on the ATO website Click here for the link. Tax return is how you report your annual income and deductions to the Australian Taxation Office (ATO), and ensure you have paid the right amount of tax, no more no less. For many of us, this means we might get a lump sum tax refund.

Tax return needs to be lodged each year from 1 July until 31 October.  A tax return should ideally be prepared and lodged by a registered Tax Agent. This will offer peace of mind to ensure that you have maximised your deductions and the tax return is lodged by the book.  Getting your tax deductions right the first time will not only increase the tax refund but also reduce the amount of stress it takes when you file your taxes.

Lodging your tax return done on time is the best way to avoid late lodgement penalties and get a tax refund on time, especially for those who have calculated that a sizeable refund might be coming their way. Australian Taxation Office (ATO) has expanded its options for lodging tax returns to make the process as convenient as possible in the majority of cases.

Completing a tax return does not need to be confusing or stressful. You can lodge your tax return using a registered tax agent or you can do it yourself online using myTax, the Australian Taxation Office’s (ATO) free tax return preparation and lodgement software.

If you lodge your tax return through a registered tax agent you will generally get an extension to 15 May, depending on your compliance history with ATO. You will need to submit your tax return by 31 October if you don't lodge it through a registered tax agent. You have four months (from 1 July to 31 October) to prepare your own tax return. In order to avail the lodgement extension to 15 May, you will need to register with a tax agent by 31 October.  This particularly helps in those instances where you might be expecting a tax bill.

We GUARANTEE all our clients a maximum tax refund! For quick, easy and comprehensive online tax returns, contact our friendly team today.  

In some cases, you may need to lodge a tax return even though you might not have reached a tax-free threshold. For example, you may have only worked for only a short time but have had PAYG withheld from your pay. Even though you have earnt less than the tax-free threshold, you will have to lodge a tax return in order to receive PAYG withheld refund. Resident companies (except non-profit companies), trusts, partnerships and superannuation funds are required by the ATO to lodge the tax returns irrespective of income.

Any other questions regarding your tax return, feel free to call our expert Cranbourne Tax Agents at 1300 300 106.

You should be able to claim a tax deduction for overtime meals provided: Overtime-Meal-Allowance


  • You received Overtime Meals Allowance from the employer in accordance with the industrial law/agreement and your claim was a reasonable amount as well as you are able to substantiate your claim through receipts, diary entries etc.
  • Any overtime meals amount which is included as a part of your wages rather than as an allowance on your payment summary is not considered as an Overtime Meal Allowance.

Keep in mind just because you have received an  Overtime Meal Allowance does not automatically entitle you to the tax deduction. The actual expense incurred in relation to overtime meals is tax deductible.

When claiming Overtime Meals Allowance you can keep records of the following to substantiate your claim:


  • Receipts/other written evidence.
  • Diary entry to record expenses where you don’t have receipts, totalling less than $200.00
  • Evidence of Overtime Meal Allowance such as payment summary, payslip etc. 

Feel free to contact one of our expert Accountants Lynbrook on 1300 300 106 to find out more about your claim for Overtime Meals Allowance.

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Individual tax returns from $110 - $130