It’s a pretty easy assumption that everyone wishes that they could pay less tax. With the economy going through its ups and downs over the past several years and the cost of living rising, being able to save money from anywhere would be great. To help you get started on saving a little more, today we’re going to share with you these 5 tips to pay less tax.
5 Tips to Pay Less Tax
Donate to charity!
While it may seem counterproductive to spend money in order to save money, every time you make a donation over $2, it’s tax deductible and can lower your tax bill.
This means that you absolutely have to keep good tax records. Many people miss out on tax deductions or end up paying in more money than they have to simply because they didn’t keep good records. For every deduction claim that you make, you need to be able to produce the receipt that showed you paid the expense. If you don’t have the receipts, you can’t claim deductions. All you have to do is spend a few minutes every week organising your documents. Or, if you’re tech-savvy, you can use an app that will help you keep track by taking images or scanning in receipts and organising them for you.
Make sure you are taking advantage of all of the claims you can make possible. For example, sometimes people use things or make purchases that they use both at home and at work. Did you know that you can claim and deduct the portion you use for work in many instances? Even if you’re not sure that a purchase is deductible, remember to keep the receipt anyway. It’s better to have an extra receipt than it is to lose out on a tax deduction.
Obtain and keep health insurance! If you make over $90,000 a year if you are single or $180,000 for families and you are without health cover, you will end up paying a 1% Medicare levy surcharge. That’s a hefty amount of money to pay, so it’s important to keep private health cover.
Seek and obtain advice from a tax professional! Yes, many people feel as though they can go about their taxes on their own, but did you know that it’s common to make mistakes or miss deductions? Not only will a tax professional help you maximise your deductions, but he or she is also required to stay on top of ever-changing tax regulations. This means that he or she will know about changes that you may not have known about that affect your taxes.
Don’t pay in too much or get too little back when it comes to your taxes. By following these simple tips, you can easily start paying less tax. Speak to us today at Paradise Financial Group to see how your tax savings can set you up for a better financial future and retirement.