NTEU Tax Guide 2019

Tax 2019 Guide

nteu.org.au/tax

Contents ATO Focus 2019.......................................................................1

NTEU National Office PO Box 1323, South Melbourne VIC 3205 Ph: (03) 9254 1910 Fax: (03) 9254 1915 national@nteu.org.au www.nteu.org.au

Common mistakes

Changes for 2019 ...................................................................1 Individuals Business Superannuation

Changes for 2020 and Beyond....................................... 2 Individuals Business Rental Properties Superannuation

The Tax System.....................................................................4

NSW & National Ph: (02) 8006 5020 Fax: (02) 4210 8682 (central fax system) Victoria Ph: (03) 9014 9590 WA Ph: (08) 6102 0560 info@teachertax.com.au www.teachertax.com.au

NTEU Tax Guide 2019. 19th edition. Published by NTEU. Written by Teacher Tax. All rights reserved Š2019. ISBN 978-0-9946377-1-0.

Online version at www.nteu.org.au/tax Authorised by Matthew McGowan, General Secretary, National Tertiary Education Union, 120 Clarendon St, South Melbourne VIC 3205.

Cover image: Andriy Popov/123rf.com This guide has been prepared for information only. Australian Tax Legislation is a complex body of law and members should seek qualified tax advice for their personal situation. While every effort has been made to ensure that the information in this guide is accurate, Teacher Tax carries no responsibility for its application. The advice given is to be considered general. Information in italics has been directly sourced from Australian Government websites.

Who needs to lodge a return?

Record Keeping Self-Assessment Self-Lodgement Using a Tax Agent

Income.......................................................................................5 Salary & Wage Income Government Income Investment Income Other Income

Deductions..............................................................................6 Bank Fees Car Expenses Clothing Donations & Gifts (incl School Building Funds) Excursions, School Trips and Camps Home Office Insurance Rental Property Expenses Self-Education Expenses Tax Returns Teaching aids Travel Expenses Union and Professional Association Fees

Rebates and Offsets............................................................8 Invalid Carer Tax Offset Low Income Tax Offset Private Health Insurance Rebate Senior Australians and Pensioners Tax Offset Zone Tax Offset

Where to find your NTEU Tax Statement...............8 Do your tax NOW!...............................................................9 Questionnaire........................................................................9

ATO Focus 2019

Changes for 2019

Each year the ATO has access to more and more information about taxpayers. Every tax return is compared to other taxpayers in similar occupations earning similar income. If a red flag is raised, the ATO can investigate. There are four things that the ATO are focusing on this year:

Individuals

1. The cash economy

They want all taxpayers to be declaring all of their cash income.

Income Tax Rates (Residents) 2018/19

Taxable income $0 – $18,200 $18,201 – $37,000 $37,001 – $90,000

2. High wealth individuals

The ATO knows that many smaller tax agents cannot cope with the complexity of high wealth taxpayers, therefore small tax agents with such clients can expect an audit.

$90,001 – $180,000 $180,001+

3. Multi-nationals profit shifting 4. Work-related expenses

A taxpayer needs to make sure they spent the money themselves and were not reimbursed, the expense was directly related to earning their income and they have a receipt or record to substantiate it. If the expense is for work and private use, they can only claim a deduction for the work-related portion.

Common mistakes Car Expenses

While you can claim up to 5,000 km without a logbook you still need to be able to substantiate your calculation. You cannot claim for travel between work and home, or if you have salary sacrificed car.

Private Health Insurance Rebate

Premiums paid to 31 March 2019 Base Tier Tier 1 Under 65yr 25.415% 16.943% 65-69yr 29.651% 21.180% 70yr or over 33.887% 25.415% Premiums paid after 1 April 2019 Under 65yr 25.059% 16.706% 65-69yr 29.236% 20.883% 70yr or over 33.413% 25.059%

Travel expenses

Airfares and accommodation need to be apportioned correctly. If you go to a conference for 4 days and then go sight-seeing for 4 days, then you can only claim 50% of the expenses. If you go with a family member, the expenses again would need to be reduced.

Self-education

A course must be connected to the income you are currently earning, either to maintain or improve your specific skills or knowledge. Course fees that have been put through HECSS/HELP cannot be claimed.

Tier 2 8.471% 12.707% 16.943%

Tier 3 0% 0% 0%

8.352% 12.529% 16.706%

0% 0% 0%

Tier 2 1.25%

Tier 3 1.5%

Medicare levy surcharge

Clothing

To be claimable clothing must be either; • Occupation specific (such as for a nurse) • Protective (such as steel cap boots or a high vis vest) • A uniform (with logos or made specifically for the business).

If you happen to wear everyday clothes to work such as black trousers and a white shirt you cannot claim the clothes or the cost of cleaning them.

Tax Rate 0 19c for each $1 over $18,200 $3,572 plus 32.5c for each $1 over $37,000 $20,797 plus 37c for each $1 over $87,000 $54,097 plus 45c for each $1 over $180,000

Rates

Base Tier 0.0%

Tier 1 1.0%

Income statements

Income statements will replace payment summaries. If an employer reports through Single Touch Payroll they are not required to provide a payment summary to their employees. Employees can access their income statements through ATO online services via myGov. Employees will receive a notification from the ATO in their myGov inbox when their income statement is ‘Tax ready’, so they can complete their tax return. Employees will be able to contact us for a copy of their income statement if they do not have access to myGov. Low and middle income tax offset (LMITO)

From 2019, the LMITO will increase to $1080 pa. This will be available from 2019 to 2022.

LMITO – current 0 – $37,000 Up to $200 $37,001 – $48 000 $200 (+ 3% of > $37k) $48,001 – $90,000 $530 $90,001 – $125,333 $530 (1.5% of >$90k) $125,334 + Nil NATIONAL TERTIARY EDUCATION UNION

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LMITO – proposed Up to $255 $255 $1080 $1080 (3% of > $90k) Nil

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This offset will automatically be claimed in taxpayer’s returns. If the changes proposed in the 2019–20 Budget become law after 1 July 2019 the ATO will automatically amend assessments. The offset can only reduce the amount of tax they pay to zero and it does not reduce their Medicare levy.

Medicare levy low income thresholds

The income thresholds have increased to $22,398 for singles and to $37,794 for families. For taxpayers eligible for the seniors and pensioners tax offset, the threshold has increased to $35,418. The family threshold for seniors and pensioners has increased to $49,304.

The family income threshold will be increased by $3,471 for each dependent child or student.

Business Expanding accelerated depreciation for small businesses

The instant asset write-off threshold now includes businesses with a turnover from $10 million to less than $50 million. These businesses can claim a deduction for the business portion of each asset that costs less than $30,000 depending of the date of purchase (see table below) Date of Asset purchase Between 12/5/15 and 29/1/19 Between 29/1/19 and 2/4/19 Between 2/4/19 and 30/6/19

Maximum Cost $20,000 $25,000 $30,000

Superannuation Downsizer contribution into superannuation

From 1 July 2018, members aged 65 years old or older, and meet all the eligibility requirements may choose to make a downsizer contribution of up to $300,000 into superannuation from the proceeds of selling their primary residence.

If a member makes a downsizer contribution it is reported in the year it is made. The member will need to provide a Downsizer contribution into super form, either before or when they make their contribution.

Downsizer contributions should be made within 90 days of the change of ownership of the dwelling (usually the date of settlement). An extension of time may be granted where there is a delay, but will not be granted to allow the member to meet the age requirement.

Downsizer contributions can be made regardless of contributions caps and other restrictions (age and work test) that may apply when making voluntary contributions.

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Changes for 2020 and Beyond Individuals Private health insurance statements

From 1 July 2019, health insurers are no longer required to send private health insurance statements. Previously they were required to send statements by 15 July each year, it is now optional to send this information.

Private health insurance information will be available in the pre-fill report, usually by mid-August. If it is not populated by then, taxpayers may need to request a statement from their health insurer.

It is important to correctly report private health insurance information as it is used to calculate private health insurance rebates and the Medicare levy surcharge, if applicable.

Proposed Personal Income Tax Rates

From 1 July 2022, the 19% bracket will be increased from $37,000 to $41,000 and the 32.5% bracket will be increased from $90,000 to $120,000.

From 1 July 2024, the 32.5% bracket will apply to taxable incomes of $41,000 to $200,000, effectively removing the 37% tax bracket entirely. Incomes over $200,000 will be in the 45% top bracket.

Rate 0% 19% 32.5% 37% 45%

Current Tax Rates 2019-22 0 – $18,200 $18,201 – $37,000 $37,001 – $90,000 $90,001 – $180,000 $180,001+

Proposed Tax Rates 2023-24 0 – $18,200 $18,201 – $45,000 $45,001 -$120,000 $120,001 – $180,000 $180,001+

Low Income Tax Offset (LITO)

From 1 July 2022, this offset will be increased from $445 to $645 Low and Middle Income Tax Offset (LAMITO)

The offset of up to $530 will apply to the 2019-2022 tax returns. This offset will be in addition to the Low Income Tax Offset.

Current LITO $0 – $37,000 $37,001 – $66,666 $66,667 +

Proposed LAMITO Up to $445 $0 – $37,000 Up to $200 $445 less 1.5% x 37,001 $200 plus 3% x excess over $37k -$48,000 excess over $37k 0 $48,001 – $530 $90,000 $90,001 – $530 less 1.5% x $125,333 excess over $90k $125,334 + 0

HELP repayments

HELP income thresholds will change for the 2019-20 financial year. It would be good to check that your employer is deducting the correct amount in extra tax to cover these new repayment rates in July 2019.

2018-19 HELP repayment rates Adjusted Taxable Repayment Income rate Below $51,957 Nil $51,957 – $57,729 2.0% $57,730 – $64,306 4.0% $64,307 – $70,881 4.5% $70,882 – $74,607 5.0% $74,608 – $80,197 $80,198 – $86,855 $86,856 – $91,425 $91,426 – $100,613 $100,614 – $107,213 $107,214 and above

5.5% 6.0% 6.5% 7.0%

2019-20 HELP repayment rates Adjusted Taxable Repayment Income rate Below $45,881 Nil $45,881 – $52,973 1.0% $52,974 – $56,151 2.0% $56,152 – $59,521 2.5% $59,522 – $ 3.0% 63,092 $63,093 – $66,877 3.5% $66,878 – $70,890 4.0% $70,891 – $75,144 4.5% $75,145 – $79,652 5.0%

7.5% $79,653 – $84,432

5.5%

8.0% $84,433 – $89,498

6.0%

$89,499 – $94,868 $94,869 – $100,560 $100,561 – $106,593 $106,594 – $112,989 $112,990 – $119,769 $119,770 – $126,955 $126,956 – $134,572 $134,573 and above

6.5% 7.0% 7.5% 8.0% 8.5% 9.0% 9.5% 10%

Business Cash payment limit

From 1 July 2019, a limit of $10,000 for cash payments made to businesses for goods and services will be introduced. This measure will require transactions over a threshold to be made through an electronic payment system or by cheque.

Expanding Single Touch Payroll

From 1 July 2020, the Government will simplify and automate the reporting of welfare income recipients through STP.

Strengthening the Australian Business Number system

From 1 July 2021, ABN holders will be required to lodge their tax returns on time.

From 1 July 2022, ABN holders will be required to confirm the accuracy of their details annually. Currently ABN holders are able to retain their ABN status regardless of if they meet lodgment requirements.

Rental Properties Vacant land deductions

From 1 July 2019, expenses associated with holding vacant residential or commercial land, including interest expenses will be no longer claimable. They can neither be carried forward, but instead added to the cost base of the land. Deductions for expenses associated with holding the land will be available once a property has been constructed on the land, it has received approval and is available for rent.

Superannuation Capping passive fees and banning exit fees

From 1 July 2019, a 3% annual cap on passive fees charged by superannuation funds on accounts with balances below $6,000 will be introduced, as well as a ban on exit fees. The ATO will also require the transfer of all inactive superannuation accounts with balances below $6,000 to the ATO. The ATO will expand its data matching processes to proactively reunite these inactive superannuation accounts with the member’s active account.

Exemption from the work test for voluntary contributions

From 1 July 2019, an exemption from the work test for voluntary contributions to superannuation, for people aged 65-74 with superannuation balances below $300,000, in the first year that they do not meet the work test requirements will be introduced. The work test exemption will give recent retirees additional flexibility to get their financial affairs in order in the transition to retirement.

Three-yearly audit cycle for some SMSFs

From 1 July 2019, the annual audit requirements will change from an annual to a three-yearly requirement for SMSFs with a history of good record-keeping and compliance. This measure will reduce red tape for SMSF trustees that have a history of three consecutive years of clear audit reports and that have lodged the fund’s annual returns in a timely manner.

Increasing the age limit for spouse contributions

From 1 July 2019 the age limit to receive spouse contributions will increase from 70 to 74.

Removing the work test for those aged 65 & 66 yr

From 1 July 2020, voluntary contributions can be made by those aged 65 and 66 years without meeting the work test.

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The Tax System Who needs to lodge a return?

If you have earned income over $18,200 in this financial year, you must lodge a return. If you earned less than this amount but had tax withheld from your salary you will also need to lodge a tax return.

Even if you’re not required to lodge a return it is a good idea to notify the ATO that a return is not necessary.

Record Keeping As the tax system is self-assessment, it is essential that taxpayers be able to substantiate their income and expenses. In general, records should be kept for a period of five years from the date you receive your notice of assessment.

Records should be kept in such categories as: • Payments you have received.

• Expenses related to payments.

• Acquisition or disposal of an asset – such as shares or a rental property.

• Tax deductible gifts or donations.

• Medical expenses.

If you’re not sure whether or not to keep a record, the best advice is to err on the side of caution. It is better to have too many records than not enough.

Self-Assessment Australia has a self-assessment taxation system. This means that your return is accepted initially by the Australian Taxation Office (ATO) as truthful.

However, the ATO will check the validity of your claims by data matching and auditing. They use this data to: • Provide pre-filling information to taxpayers and their agents to help them correctly complete their income tax return first time.

• Identify discrepancies between information reported by taxpayers in their tax returns against details reported by third parties.

• Identify particular non-compliant behaviour within selected target groups, or to conduct risk assessments.

• Assist in administration of the relevant legislation with other government departments through data exchange.

• Exchange with treaty partners.

The responsibilities of taxpayers include: • Be truthful and cooperative in your dealings with us.

• Take reasonable care in preparing your tax returns and in keeping your records.

• Lodge your documents and pay any amounts payable by the due date.

The responsibilities of the ATO: • Treat you fairly and reasonably.

• Treat you as being honest in your tax affairs unless you act otherwise. p.4

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• Offer you professional assistance to help you understand and meet your tax obligations.

• Accept you can be represented by a person of your choice and get advice about your tax affairs.

• Respect your privacy.

• Keep your information confidential in accordance with the law.

• Give you access to information we hold about you in accordance with the law.

• Give you advice and information you can rely on.

• Explain to you the decisions we make about your tax affairs.

• Respect your right to a review.

• Respect your right to make a complaint.

• Administering the tax system in a way that minimises your costs of complying.

• Be accountable for what we do.

Self-Lodgement Tax returns are submitted either by individuals or their tax agent to the Australian Tax Office on an annual basis. If you are doing the return yourself, it must be lodged by 31 October. The ATO has the power to fine the taxpayer up to $180 for every 28 days the return is late to a maximum of $900. Interest on any tax payable may also be charged.

Our advice is to get it in on time and save the stress and hassle.

The return is assessed by the ATO and you are issued with a Notice of Assessment.

The Notice of Assessment will summarise your taxable income for the year. It may include a tax refund or an amount payable.

Using a Tax Agent If you lodge through a Tax Agent, you may be able to avail yourself of the general extension of time granted to Tax Agents (usually 31 March of the following year). To avoid penalty however, you must be registered as a client with a tax agent by 31 October.

Other advantages of using a Tax Agent include: • A quicker turnaround for refunds.

• A thorough and professional check to ensure all information is correct.

• Advocacy in the case of audit / dispute.

• Tax planning to reduce tax.

Income

Investment Income

In general, income tax is calculated by subtracting allowable deductions from assessable income. Assessable income can be obtained in a variety of ways: Salary & Wage Income Salary and wages are the main forms of payments made to an employee. Generally they are considered to be payments made to an individual as remuneration for services, and provided under a contract of service (employment contract). Other payments include: • Allowances can be for car, travel or transport, tools, clothing or laundry, dirt, site, risk, meal or entertainment or for qualifications held e.g. a first aid certificate.

• Any payment received under sickness or insurance policy for loss of income is usually considered assessable.

• Certain lump sum payments in respect of unused annual leave and long service leave are entitled to concessional tax treatment when you terminate your employment. That is why the amounts are separately recorded on your payment summary and separately recorded on your tax return. We suggest that you obtain professional advice if you have any lump sum payments labelled A B C D or E on your payment summary.

• Eligible Termination Payment (ETP) is a lump sum payment paid by an employer or a superannuation fund. Some of these payments receive concession tax treatment up to certain limits called caps. Areas include resignation, age retirement, redundancy, dismissal, death of an employee.

Government Income Assessable government payments include: • Age pension • Newstart allowance • Youth Allowance • Austudy payment • Parenting payment (partnered) • Partner Allowance • Sickness Allowance • Special benefit • Widow Allowance • Farm household allowance • Interim income support payment • The following payments if you are 16 or older • Abstudy living allowance • Payments under the Veterans’ Children Education Scheme • Payments under the Military Rehabilitation And Compensation Act Education and Training Scheme 2004 (MRCA education allowance) • Other taxable Australian Government education or training payments • Community Development Employment Project (CDEP) payments • Disaster recovery allowance

• Rental income when you rent out your property. The rental income must go on the tax return of the taxpayer whose name appears on the title deed of the property. This is most often a 50% spilt between two taxpayers.

• Dividend income including dividends paid directly to you, dividends applied under a dividend reinvestment plan, dividends that were dealt with on your behalf and bonus shares that qualify as dividends.

• Interest income can include interest the ATO credited tax account with. It also includes money received from financial institution accounts and term deposits. NB If you operated an account for a child and the funds in that account belonged to you, or you spent or used the funds in the account as if they belonged to you, you must include any interest from the account.

Other Income Business income may include earnings from your operation through a Sole Trader, Partnership, Trust or Company structure.

The ATO makes a distinction between what is considered a business and what is a hobby. There are certain tests that must be satisfied in order to gain treatment as a business (e.g. the ’business’ must make a consistent profit).

Capital Gains income could include any capital gain or capital loss on the disposal of certain assets. Reasons leading to a possible event can include: • An asset you own is lost or destroyed (voluntary or involuntary).

• You give an asset away.

• You enter into an agreement not to work in a particular industry for a set period of time.

• Shares you own are cancelled, surrendered or redeemed.

• A liquidator or administrator declares that shares or financial instruments you own are worthless.

• You grant an option to someone to buy an asset that you own.

• You receive a non-assessable payment from a unit trust or managed fund.

• You dispose of a depreciating asset that you used for private purposes.

• You stop being an Australian resident.

This is a complex area of tax law and we recommend you consult a tax professional.

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Deductions Deductions are allowable expenses or outgoings that have been incurred in earning any assessable income. An expense must be incurred, that is either paid, or definitely committed to be paid, such as holding the invoice. You must have written evidence to prove your claims if your total claims exceed $300. Deductions can include the following items.

Bank Fees Fees incurred due to having your salary paid directly into a bank account are a claimable expense.

Car Expenses Using your car for work purposes can be claimed as a deduction. It does not include travel between work and home. You can claim for travel between two separate workplaces, or between a workplace and a place of business.

Method 1 – Cents per kilometre

You can claim up to 5,000 business km per car. The rate of 66c per km is applicable for all cars. You do not need written evidence as such but you need to be able to show how you calculated your claim.

Method 2 – Logbook

You claim the business percentage of costs associated with running your car. You need to record odometer readings and you need evidence of all costs except fuel.

Clothing You can claim the cost of clothing if it falls into one of the following categories: • A compulsory uniform – a set of clothing that identifies you as an employee.

• A single item of distinctive clothing, such as a jumper or tie, if it is compulsory for you to wear it at work. Generally having a logo permanently attached and the clothing is not available to the general public.

• A non- compulsory BUT registered uniform.

• The cost of buying, hiring, replacing or maintaining protective clothing. You can also claim a deduction for the cost of clothing that you use at work to protect your ordinary clothes from soiling or damage – for example, laboratory coats or art smocks. Also, you are allowed to claim for sun protection such as sunscreen, sunglasses and sunhats. n.b. Expenditure on sports clothes such as tracksuits, t-shirts, aerobics clothing, swimming costumes and running shoes is considered conventional clothing and is not an allowable deduction.

Donations & Gifts (incl School Building Funds) Donations must meet certain conditions. They must be made to a Deductible Gift Recipient – a list of such organisations can be found at www.abn.business.gov.au. Gifts can include: • $2 or more p.6

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• Property purchased during the 12 months before making the gift • Listed shares valued at $5,000 or less • Trading stock disposed of outside the ordinary course of business • Cultural gifts Program • Heritage gifts Examples of payments that are not gifts include: • Purchases of raffle or art union tickets • Purchases of chocolates, pens etc.

• The cost of attending fundraising dinners, even if the cost exceeds the value of the dinner • Membership fees • Payments to school building funds as an alternative to an increase in school fees • Payments where the person has an understanding with the recipient that the payments will be used to provide a benefit for the donor Contributions to school building funds can also be deductions. The ATO states that a school building fund has the following characteristics: • The fund is a public fund.

• The public fund is established and maintained solely for providing money for the acquisition, construction or maintenance of a building.

• The building is used, or is to be used, as a school or college, by a government or a public authority, or a non-profit society or association. n.b. A deduction is not allowable for purchasing gifts for other teachers or students: “Teachers may outlay their own money to supply items to students for their own individual needs (e.g. books and uniforms); purchase gifts for students (e.g. Christmas gifts); purchase food and drinks for special occasions (e.g. student birthdays) and replace money lost by students (e.g. money for bus fares and lunch). While employee teachers may feel a moral, personal or social obligation to outlay these expenses, there is no connection between the expenditure incurred by the employee teacher and producing assessable income.”

Excursions, School Trips and Camps The trips MUST be related to the curriculum or extra-curricular activities.

Factors determining relevance would include the purpose of the trip, the activities undertaken, and the duties of the teacher. For example, a teacher accompanies a class of school students on a day excursion to visit Parliament House as part of the social studies curriculum. The purpose of the trip as well as the activities have a direct relevance to the curriculum therefore, all expenses would be deductible.

Supervising students alone is not sufficient to make the expenses deductible. For example, a teacher accompanies a group of students to visit their sister school. Half of the time is spent at the sister school engaging in social, classroom and sporting activities. Half of the time is spent in tourist activities. The trip is open to all students and is not part of the curriculum of any particular course at the school.

Even though the trip may provide social and cultural benefits to the

students, the expenses incurred by the teacher are not deductible.

However, if the trip is not curriculum-related but forms an integral part of the extra-curricular activities and the teacher accompanies students as a representative of the school (e.g. school sporting events or school band competitions) the expenses would be allowable.

The deductibility of expenses incurred to inspect a possible excursion venue prior to taking the students depends on the purpose and reasons for undertaking such an inspection; e.g. expenses associated with prior visit of a venue to ensure that it meets safety requirements are allowable. However, if a teacher visits a venue privately then decides that it would make a good excursion venue, the private visit expenses are not claimable.

• Pest control • Property agent fees or commissions • Repairs and maintenance • Stationery • Telephone • Water charges • Travel costs to inspect the property.

If only part of your property is rented out, these expenses must be apportioned.

Home Office

Expenses incurred in completing training provided by a school, college, university or other place of education. You must have undertaken the course for use in carrying on a profession, business or trade or in the course of employment. It MUST relate to your work as an employee at the time you were studying. The first $250 of these expenses is not claimable. Such expenses may include: • Textbooks • Student union fees • Stationery • Course fees • Travel expenses • Decline in value of equipment.

NB In general, the costs associated with personal motivation seminars are not tax deductible. Whilst they vary from course to course, the ATO’s view is that ‘the material covered is too general to be classed as relating specifically to income-producing activities.’

Self-Education Expenses

When you carry out work activities your home office, you can claim the heating, cooling, lighting and cleaning as well as the decline in value of and repairs to your home office furniture and fittings. The ATO has set a fixed rate of 45 cents per hour for these office expenses instead of keeping details of actual costs.

Also, the following may be applicable (apportioned for private and work use): • Answering machines • Briefcase • Calculators and electronic organisers • Computers and computer software • Mobile phones , Telephones • Facsimile machines • Pagers • Hiring equipment • Technical or professional publications • Teaching aids

Tax Returns

Insurance Insurance against the loss of income is usually a legitimate expense.

It should be noted that this does not include Private Health insurances and the like.

Rental Property Expenses You can claim expenses relating to your rental property but only for the period your property was rented or available for rent – e.g. advertised for rent. Expenses could include: • Advertising for tenants • Bank charges • Body corporate fees • Borrowing expenses • Council rates • Decline in value of depreciating assets • Gardening and lawn mowing • Insurance • Land tax

The cost of managing your tax affairs is a tax deductible expense in the year that it is incurred (e.g. this year, you can claim last year’s costs). These expenses must relate to a qualified tax advisor. They can include the preparation and lodgement, advice, costs of travel to and from the advisor and obtaining reference works.

Teaching aids Items purchased must have a direct and relevant use in carrying out your duties. Examples include: • Pens, pencils, markers/highlighters, stamps, stickers, paints, stationery, posters, maps, laminating.

• Storybooks, jigsaws, games, toys used by early childhood, primary school or special education teachers.

• Items used in cooking or sewing classes or science experiments.

• Prizes purchased to reward achievement and encourage students.

• Entrance fees for school excursions.

• Whistles and stopwatches used by physical education employee teachers.

• Calculators/calculator batteries • Maintaining classroom or school pets.

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Rebates and Offsets

Travel Expenses If you have to travel away for work, then certain expenses may be deductible which may include: • Air, bus, train, tram and taxi fares • Bridge and road tolls • Parking • Car hire fees • Meals • Accommodation.

If a travel allowance is received and the amount of the claim for expenses incurred is no more than a reasonable amount, substantiation is not required. If the deduction claimed is more than the reasonable amount (rates outlined by the ATO depending on travel location) the whole claim must be substantiated, not just the excess over the reasonable amount.

If the dominant purpose in incurring the cost is the attendance at the conference or seminar then the existence of any private activity would be merely incidental and the cost would be fully deductible.

If the attendance at the conference or seminar is only incidental to a private activity (e.g. a holiday) then only the costs directly attributable to the conference or seminar is allowable deduction. The cost of accommodation, meals and travel directly relating to the private activity is not allowable.

Union and Professional Association Fees You can claim for the cost of being a member of a Union or Association. See below for where to find your NTEU Tax Statement.

Tax offsets (or rebates) directly reduce the tax payable. Usually, tax rebates can only reduce your tax payable to zero, with the exception of franking and private health insurance.

Invalid Carer Tax Offset If you maintained a dependent invalid relative you may be entitled to a tax offset depending on your adjusted taxable income.

Low Income Tax Offset You may be eligible for a tax offset if you are a low-income earner. You don’t have to claim this offset. The ATO will work it out for you when you lodge your tax return. The offset can only reduce the amount of tax you pay, it does not reduce your Medicare levy.

Private Health Insurance Rebate If you have private health insurance, you are entitled to a tax rebate.

Most people claim this throughout the year in the form of a premium reduction.

Senior Australians and Pensioners Tax Offset The pensioner tax offset and the senior Australians tax offset have been combined to form the seniors and pensioners tax offset (SAPTO).

Zone Tax Offset If you live and work in a remote area you may be entitled to the zone offset.

Where to find your NTEU Tax Statement If you pay your fees via direct debit, credit card or invoice

Your Tax Statement can be accessed via your online Member Tools page. Login in at www.nteu.org.au/members and select “Print Tax Statements” in the Payments box. Please note that statements will not be mailed out.

If you pay your fees via payroll deduction

Membership fees will appear on the PAYG summary supplied by your employer. Contact your Payroll Department for any inquiries.

TAFE members and ex-members

Tax statements will be sent to your home address in early July.

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NATIONAL TERTIARY EDUCATION UNION

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TAX GUIDE 2019

Do your tax NOW! Let us help you lodge your tax return. Our tax service was designed BY teachers FOR teachers.

We will access your income details with the ATO and then we just need to add in your work-related expenses. We can correspond by email or phone if you prefer. Your refund will be deposited into your bank account within *14 days (*ATO processes 94% in 14 days).

Our fee is only $110 (incl GST) for a standard return, which is deducted from your refund. NTEU members receive a 10% discount.

Email : info@teachertax.com.au Phone: (02) 8006 5020 Fax: (02) 4210 8682 We just need the following details to act as your agent and get started: Full Name Date of birth Tax File Number Address Phone Email

Signed Client _______________________________________________________

Date ___________________

Please complete the questionnaire below...

Questionnaire Do you have a spouse or de facto?

(If yes, please supply name, date of birth & approximate taxable income) Do you have dependents? (If yes, how many?)

Do you have Private Health Insurance?

Do you have a HELP debt?

Income

How many payment summaries are you expecting?

If you receive an allowance on your payment summary what is it for? (e.g. travel) Do you receive any Government pensions or allowances?

Do you have any savings which earns bank interest?

Do you have any shares that receive dividends?

Do you earn any business income?

Do you own a rental property?

Continue questionnaire overpage...

NATIONAL TERTIARY EDUCATION UNION

•

TAX GUIDE 2019

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p. 9

Deductions

D1

Use of your own car for work Estimate of kilometres up to travel (not to and from work) 5,000km

D2

Travel not reimbursed by your Accommodation school Flights Car Hire Public Transport

D3

Work clothing

School Logo or Protective

D4

Self-education (must be a link between the course and your current employment)

Course Name

D5

Other work expenses

$

Institution Course Fees

$

Textbooks

$

Travel

$

Bank Fees

$

Books and Journals

$

Computing (< $300)

$

Computing (> $300)

$

Purchase date Description

Internet (monthly cost)

$

% work use

Memberships

$

Phone (monthly Cost)

$

Seminars

$

Stationery

$

Subscriptions

$

Sun Protection (Hat, sunglasses, sunscreen)

$

Teaching aids, resources

$

Teacher registration

$

Union Fees

$

Working with Children check

$

Or estimate km

Home Office (Estimate of hours spent working from home each week)

D9

Donations

$

D10

Tax Affairs (Cost of getting your tax done last year)

$

D15

Other

10

NTEU TAX GUIDE 2017

Income Protection Insurance

$

% work use