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Individual Tax Calculator

One Click Life have released their Individual Tax Calculator, available on their website by clicking here.

The Tax Calculator is dynamic, making it perfect for scenario mapping. The tax calculator takes into account the Medicare levy and allows you to enter in your income, tax paid or withheld and your deductions.

Having a dynamic tax calculator assists in tax planning for working out how much you might need to spend to remove a tax problem, or to increase your refund.

Where to find your information to use the Tax Calculator

Most of the information will come from your employer, or if you’re self-employed, from your bank statements or Xero/MYOB/Quicken.

Income

Each pay you receive should also contain a payslip. If your income is fairly static, you can work out how much you will earn for the year by taking your year-to-date position and expanding this out over the year.

For example, if you have earned $40,000 to the 28th of Feb, you can divide this by 8 months to work out your monthly earnings and times this by 12 months to capture the full year.

$40,000 / 8 months x 12 months = $60,000.

In this example you would enter $60,000 into the income field on the Tax Calculator.

Tax Withheld

In the same way as the income in the above example, your tax withheld is found on your payslip. You can take your tax withheld and expand this out to capture the full year.

For example, if you have had $8,000 tax withheld to the 28th of Feb, you can divide this by 8 months to work out your monthly earnings and times this by 12 months to capture the full year.

$8,000 / 8 months x 12 months = $12,000.

In this example you would enter $12,000 into the income field on the Tax Calculator.

At this point due to the dynamic nature of the Tax Calculator it will show an estimated tax refund of $833.

Deductible Expenses

For something to be an individual tax deduction, and recognised as an ATO deduction, it has to meet 3 criteria outlined by the taxation department. These criteria include: 

  1. It has to be a work-related expense
  2. You need to have spent money on it yourself, and not be reimbursed
  3. You need to have proof 

If you have lost the receipts for work-related expenses (tax deductions) already purchased, you can still claim the tax deduction as long as you have proof of purchase. A credit card statement would work as a record of the purchase in this case. Alternatively, the ATO would also accept a written diary entry if you weren’t able to produce a credit card statement. This would be suitable in the case of paying for work-related tax deductions in cash. The diary entry should record what you purchased, where you purchased the item, what time you purchased it and the amount the item cost.

Keep in mind you can also enter your car expenses under deductible expenses. If you are just using your car to go to and from work, then you can’t claim your car expense on your tax.

You can only claim your car expenses on tax if you are using your car for work-related activities, such as travel between clients.

Additionally, you can claim expenses on your car as a tax deduction if you have to move heavy equipment between your house and work, because you have no other safe space to store it. If you’re using the cents per kilometre method, you can multiply the rate of 72c per km by the number of kilometres you travel. When claiming car expenses as a tax deduction, you need to keep a logbook of all the work kilometres you drive.

For more information on deductions, see the below link to 2022 tax deductions.

TAX TIPS: What deductions can I claim on tax 2022? | One Click Life

For help, tax advice or tax planning assistance, please contact us via One Click Life App by booking a meeting, or call us on 1300 707 117.