We Asked a Tax Agent Your Burning Student Questions For Tax Time

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If you’ve ever done your taxes and wondered ‘what on earth am I doing?’ or ‘have I completely screwed this up?’ 

Given it’s now a new financial year, the time has come for us to prepare our tax returns and find out if we’re tax winners or losers (aka if we’re getting money back or having to pay the government money).  

The Australian Tax Office (ATO) does recommend waiting until late July so all your information is pre-filled on myGov. But after that you have until 31 October to lodge a return.  

If you are using a tax agent this date could be later, but we would advise double-checking with a qualified tax agent.  

To help you, we spoke to Tandin who is a tax agent at Elite Tax and asked him the need-to-know info when it comes to taxes.  

Student Edge: What’s the biggest mistake you see students make? 

Tandin: The most common error we have faced is that students think that they haven’t earned much and then they don’t have to do their tax filing. But it is wrong. Even if you earned less than the tax free threshold, which is $18,200, you still need to lodge your tax return because you might lose all your tax refund. 

Also, if you are not lodging a tax return, at least inform the ATO that this year you haven't earned anything. But it is your responsibility to do so.  

Student Edge: What are some common myths about tax? 

Tandin: One of the common observations that we see is most [people] assume that, you know, ‘my employer does tax.’ Which is wrong. Your employer only withholds tax.  

It is your responsibility to do the tax return…and for students, one important thing that you need to keep in mind is the payment from Centrelink. Most students assume that it is not taxable, but payments like Youth Allowance are actually taxable. So basically, any income that you have received may be taxable.  

So be it in cash or in the bank, it is taxable. If you have earned any income, it is important that you declare to the ATO how much you have earned.  

Student Edge: What can you tell us about deductions? 

Tandin: Taxable deductions are basically the, you know, tax heroes, because it reduces your taxable income.  

For example, if you earned $100 and you incur the expenses of $10 you are not taxed on $100 you are taxed on $90 provided that you have this proof of receipt. It's very important for you to store those receipts in [a safe place].  

So any expenses that you have incurred while earning that income like be uniform, your laundry expenses a work related telephone or internet, and your subscription like Grammarly and AI tools are actually deductible, but not Spotify. You cannot say that. You know, Spotify helped me, motivated me, or something like that, and then it's work related. 

Student Edge: Should we keep a record of documents before tax? 

Tandin: Anything related to your income, like pay slips, the invoices that you have, please store it and save it, and then same for the expenses. Try to spend more from your bank rather than spending your cash, because at least it leaves a trace. Even if you lose that receipt, you at least have a trade from your bank statement saying that you have paid for that expense.  

Keep [receipts] for at least five years, in case the ATO might audit you, it will be within five years. So, it is important that you store those documents for at least five years. 

Student Edge: What happens if you don’t lodge your tax return on time? 

Tandin: The ATO is chill until they are not. So, what happens is, basically they start with a friendly reminder followed by a scary one, and you don't want that one. Also, like I mentioned before, you might miss out on your tax return. So to avoid the penalties, do not miss your tax refund.  

It's important that you do your tax filing on time. The deadline for individuals is 31 October. But if you do your tax return like through an agent like us, you get up to May of the following year, so you get some extra months to do your tax filing. 

If you’re doing your taxes anytime soon, good luck and we hope you’re a tax winner 😉 

This article does not constitute personal financial advice. Before acting on any information in this article, you should consider your money goals and financial situation to ensure it’s appropriate to you.