Common Tax Return Mistakes and How to Avoid Them (With the Help of a Tax Accountant!)
Fri, 12 Jul 2024Tax Season. Just the mention of it can make even the most organised individual stressed. Are you too stressed out???
The deadlines that always look too close, the pile of paperwork that is so tough for you to handle, and the constant fear of making a mistake that could cost you a lot. All these problems are enough to make you use stress balls.
But don’t worry. With some knowledge and resources, you can avoid the most common tax return mistakes and deal with the tax season with confidence. This blog will help you learn about those mistakes and how you can easily avoid them with the help of a professional tax accountant in Perth or anywhere you reside.
Common Tax Return Mistakes
Mistake 1: Selecting the Wrong Form:
In Australia, there are different tax forms are used on the basis of people’s income sources and filing status. If you select the wrong one, it will cause a processing delay and errors. To avoid this, it’s very important to choose the right form for your exact situation. If you are not confident about it, consult with a professional tax accountant in Perth to be on the right path.
Mistake 2: Math Errors:
Math errors are a common mistake when you file a tax return. But keep in mind that these common mistakes have a big impact. A simple addition, subtraction, or even a misplaced decimal can make your tax return off balance.
To avoid these issues, always double-check your calculations. Better yet, use tax software that helps in accuracy by automatically doing the necessary calculations. This extra step can save you from the headaches you get while going through math errors.
Mistake 3: Missing Income Sources:
It’s important to report all your income sources for tax returns. This includes side jobs. Freelance work and investment earnings. If you forget to register or report all your income sources, big penalties from the ATO (Australian Taxation Office) will be charged, and legal problems will be on your way.
Keep track of all your incomes throughout the year, and make sure to report them on your tax return in a correct manner. If you’re confused or not sure about any of your income, it’s better to include it and ask a professional tax accountant for help.
Mistake 4: Forgetting to Claim Deductions and Credits
Deduction and credits are your friends in tax returns. They can really help lower your taxes. But many people forget to claim all the deductions they can get.
It’s human nature to forget things, but don’t miss out on this one. It’s very important to look into all the deductions and credits that apply to you. Take help from a small business tax accountant to claim these deductions. They will make sure you save as much as possible.
Mistake 5: Incorrectly Reporting Dependents
When you claim dependents on your tax, it can give you great benefits like tax credits. But to get the benefits, you must follow some specific rules and have the correct social security numbers.
Many people make mistakes when claiming dependents, so be sure you meet all the necessary requirements before including them on your return.
Mistake 6: Filing Late:
There is a saying it’s better late than never, but in filing a tax return, it’s not an option. Filing late can incur penalties and interest charges to you. The ATO gives you options for electronic filing and extensions. So, there is no excuse for you to miss the deadline.
Tips for a Smooth Tax Season
Organise Your Records Early
Start collecting all your relevant documents like income statements, receipts, and W-2s early in the year. This will make the process much easier when you’ll file your taxes.
Always Double-Check Everything
Before submitting your tax return, make sure to review it carefully. Double-checking can let you find any mistakes that could cause bug problems later. It’s also a good idea to have someone else review your return for an extra layer of security.
File Electronically
Filing your taxes electronically has many benefits. It speeds up processing time, reduces the chance of errors, and ensures your return is received safely. Plus, you'll get your refund faster!
Consider Tax Software or a Tax Professional
Using tax software can guide you through the process and help reduce errors. For more complex situations or to maximise your deductions, consulting a tax professional can be very helpful. They can offer personalised advice and ensure you get the most out of your return.
Wrapping Up!
Tax season doesn’t have to be stressful for you. By understanding common mistakes and how to avoid them, you can make the process go smoothly. And if all these seem too complex, a tax accountant can offer you a big help.
Remember, a little preparation can make a big difference in your tax season experience.
At WMK Accounting, we’re your professional tax accountant in Perth, and we're ready to help you with your tax returns. Our expertise can save you time, money, and the stress of potential mistakes.
To learn more about our services and schedule a consultation, click here.