NTEU Tax Guide 2010

w w w. n t e u . o r g . a u / t a x

Contents

Budget 2010 .................................................. 1Standard deduction option for tax returns 150% reduction in tax on the first $1,000 of interest income 1Increase of superannuation contributions of employers from 9% to 12% of gross wage 1Increase in the age of those eligible for compulsory superan-nuation 1Medical Expenses Rebate 1Income Tax Rates (Residents) 1

The Tax System ............................................... 2Targets for 2010 2Changes for 2010 and beyond 2Self Assessment 2Who needs to lodge a return? 3Record Keeping 3The lodgment process – Self Lodgment 3The lodgment process – Using a Tax Agent 4

Income ........................................................... 4Salaries and Wages 4Allowances 4Sickness and Insurance Payments 4Lump Sums 4Rent 4Dividends 4Interest 4Pensions 4Other Government Allowances 5Payments, supplements and benefits 5Capital Gains Tax 5Business Income 5Exempt Income 5

Deductions ..................................................... 5Home Office 5Insurance 6Bank Fees 6Motor Vehicle expenses 6What is itinerant? 6Self Education Expenses 6Gifts and Donations (including School Building Funds) 7Clothing 7Managing your tax affairs 7Other Deductions 7Rental property expenses 7

Rebates / Offsets ............................................ 8Education tax offset 8Low income tax offset 8Housekeeper tax offset 8Invalid relative tax offset 8Parent or spouse’s parent tax offset 8Private health insurance rebate 8Senior Australians tax offset 8Mature age worker tax offset 8Net medical expenses tax offset 8Franking tax offset 8Termination Payments 8

Do your 2009 tax NOW! .................................. 9

NTEU contact details 14Teacher Tax contact details 14

This guide has been prepared for NTEU members for their 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, NTEU or Teacher Tax carries no responsibility for its application. The advice given is to be considered general.

We encourage members to contact Teacher Tax on (02) 8006 5020 to discuss their personal situation. NTEU members will be offered a discount rate.

NTEU Tax Guide 2010, Published by National Tertiary Education Union ©2010. Written by Teacher Tax. Online version at www.nteu.org.au/tax

NTEU TAX GUIDE 2010 1

Budget 2010

The Federal Budget was brought down on 11 May 2010.

The budget at a glance included:• A deficit of $40.8 billion.• A standard deduction option for tax returns from 2012.• A 50% reduction in tax on the first $1,000 of interest

income.• An increase of superannuation contributions of employers

from 9% to 12%.• An increase in the age of those eligible for compulsory

superannuation.• An increase in the low income tax offset and minor altera-

tion of marginal tax rates.• A gradual cutting of the company tax rate.• A mining “super profits” tax.• A change to the rebate for medical expenses.

The major aspects of the budget that may be of interest to NTEU members include the following.

Standard deduction option for tax returns

This measure will allow tax payers to claim a “standard deduc-tion” for work related expenses on their tax return without the need for receipts. This option will be available for the first time in 2012 – at a rate of $500 per worker. This will increase to $1,000 per worker the following year.

For the many Taxpayers with deductible expenses greater than the standard deduction, they will still be able to claim these higher expenses, in lieu of claiming the standard deduction amount, by lodging a tax return.

50% reduction in tax on the first $1,000 of interest income

From 1 July 2011 The Government will provide individuals with a 50% tax discount on up to $1,000 earned on interest.

This measure also applies to bond, debentures and annuity products. The discount will be available for interest income earned directly as well as indirectly, such as via a trust or a managed investment scheme (MIS).

Increase of superannuation contributions of employ-ers from 9% to 12% of gross wage

Employer’s compulsory superannuation contributions will gradually rise from 1st July 2013 – leveling out at 12% in a decade.

Rate (%) Year

9.25 2013-14

9.5 2014-15

10 2015-16

10.5 2016-17

11 2017-18

11.5 2018-19

12 2019-20

Increase in the age of those eligible for compulsory superannuation

From 1 July 2013, employers are required to make Superannua-tion contributions on behalf of workers up to the age of 75.

Medical Expenses Rebate

The threshold will increase from $1500 to $2000 beginning July 1st, 2010. Any eligible family spending over this amount will be entitled to the offset of 20 cents per dollar.

Income Tax Rates (Residents)

2009 – 2010 2010 – 2011

Taxable income Tax Rate

Taxable income Tax Rate

$1 – $6,000 0 $0 – $6000 0

$6,001 – $35,000 15% $6001 – $37000 15%

$35,001 – $80,000 30% $37001 – $80000 30%

$80,001 – $180,000 38% $80001 – $180000 37%

$180,001 and over 45% $180,001 and over 45%

Also, the low income tax offset has been raised from $1350 in the 2010 year to $1500 in the 2011 year.

This will effectively mean that no tax will be payable up to $16,000 earnings in 2011, increasing from $15,000 this year.

The Low Income Tax Offset is not available for taxpayers who exceed the following income –

2010 – $63,750

2011 – $67,500

2 NTEU TAX GUIDE 2010

The Tax System

Targets for 2010

Each year, the ATO announce specific areas they intend targeting.

This year, the ATO will be targeting:

Specific Occupations

The ATO has identified the following occupations as “high risk”• Truck drivers.• Sales and marketing managers.• Sales representatives.• Electricians.

Individuals through data matching

Advances in technology have meant that the ATO becomes more equipped each year to match data from a number of agencies. These include banks, share registries, other Government Agencies and Health Insurers.

Work Expense Claims

In relation to work related expense claims, the ATO recently stated:

Last year we conducted more than 5,900 audits and reviews resulting in $7.6 million in adjustments.

Retail investment products

These are managed fund type schemes that have been set up to deliberately minimize tax in an illegal way.

International transactions

The ATO has stated –

This year our support and compliance activities will focus on:• Australian residents deriving

foreign source income or claiming deductions and exemptions in respect of cross-border transactions

• financial and structural arrange-ments that rely on the secrecy laws and lack of transparency offered by some international jurisdictions,

focusing on concealed assets and income that are subject to tax in Australia

• foreign residents deriving Austra-lian income, to ensure they meet their income tax obligations

Changes for 2010 and beyond

Medical Expenses Rebate

The threshold will increase from $1500 to $2000 beginning July 1st, 2010.

Medicare Levy Exemption

Families earning less than $31,196 (up from $30,025) and Individuals earning less than $18,488 (up from $17,794 will not have to pay the Medicare levy.

Updated Notice of Assessment and Statement of Account

One change that will be noticed after tax is completed is the Notice of As-sessment, which outlines either your tax refund or liability. The layout has changed (see below).

There has also been the introduction of a Statement of Account that will be sent to some taxpayers under special circumstances.

The ATO states:

You will only receive a statement of account with your income tax notice of assessment (NOA) or notice of amended assessment (NOAA) if you:• Incur a penalty or general interest

charge as part of the assessment process.

• Are due to receive credit interest amounts as part of the assessment process.

• Have any credits offset to other debts either other tax debts or debts you have with other govern-ment agencies.

• Have other amounts payable / re-fundable on your account included in the opening balance, or

• Have lodged returns for multiple financial years on the same day.

Self Assessment

Australia has a self assessment taxation system. This means that your return is accepted initially by the Australian Taxation Office as truthful. This does not mean, however, that the ATO will not, from time to time, check the validity of your claims. This can occur, for example, by data matching and auditing.


How extensive is this?

In a report published by the ATO, the following facts were revealed in relation to the 2009 Financial Year:

• We amended 368,100 individuals’ assessments, while individuals self-amended 233,800.

• We reviewed 28,400 returns in re-lation to high risk refunds resulting in revenue adjustments of $65.1 million.

• We raised $44.0 million in revenue adjustments from 410 reviews and audits of executives and directors.

• We sent educational letters to 422,000 individuals about claim-ing work-related expenses.

• We sent educational letters to 134,800 individuals about rental income and expenses and capital gains tax.

• We wrote to 65,000 individuals asking them to review their claims. About 4,400 reviews or audits were completed resulting in revenue adjustments of $9.6 million.

• We reviewed or audited 2,700 people concerning capital gains tax resulting in revenue adjustments of $16.5 million.

• We compared third-party informa-tion against returns. 403,600 income and benefits discrepancies resulted in revenue adjustments of $259.9 million.

• We undertook 310 compliance focused visits to tax agents.

• We acquired and processed an additional 33 million share transactions in 2008–09, bringing the total share transactions we use in data matching to 166 million. We also received an additional 2.8 million property records, bringing the total number of processed real property transactions used in our matching activities to 22.9 million.

In line with this, the ATO outlines the following responsibilities of taxpayers:

1. Be truthful in your dealings with us2. Keep records in accordance with

the law3. Take reasonable care in preparing

your tax returns and other docu-ments and in keeping records

4. Lodge tax returns and other required documents or information by the due date

5. Pay your taxes and other amounts by the due date

6. Be cooperative in your dealings with us.

In return, the ATO promise to work within the following service charter

1. Treat you fairly and reasonably2. Treat you as being honest in your

tax affairs unless you act otherwise3. Offer you professional service and

assistance to help you understand and meet your tax obligations

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

5. Respect your privacy6. Keep the information we hold

about you confidential in accor-dance with the law

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

8. Give you advice and information you can rely on

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

10. Respect your right to a review11. Respect your right to make a

complaint12. Administering the tax system in a

way that minimises your costs of complying

13. Be accountable for what we do.

Who needs to lodge a return?

In general, if you have earned income over $6,000 in the financial year, you

must lodge a return. Also, you will need to lodge a return if you have paid any tax at all. Even if you haven’t been employed, you may have been credited bank interest and paid withholding tax.

Special rules apply to Senior Australians (a male aged 65 years or more or a male veteran or war widower aged 60 years or more who met the veteran pension age test. A female aged 63 years or more or a female veteran or war widow aged 58 years or more who met the veteran pension age test.)

Check with your tax agent.

Even if you’re not required to lodge a re-turn, in some cases, you need to advise the ATO by filling out the prescribed Non Lodgment Advice.

Record Keeping

Because the tax system is self assess-ment, 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.

The lodgment process – Self Lodgment

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


$110 for every 28 days the return is late to a maximum of $550. 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 Assess-ment.

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

(See page 2 for details regarding the new format of these Notices)

If you have any objections to your Notice of Assessment, you need to call the ATO as soon as possible.

The lodgment process – 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 31st March 2011).

To avoid penalty however, you must be registered as a client with that tax agent by 31 October 2010.

There are other advantages of using a Tax Agents. These can 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

In general, income tax is calculated by subtracting allowable deductions from assessable income.

Assessable income can be obtained in a variety of ways. The income we are likely most familiar with is that which is paid in return for our labour (employment income).

It should be noted that payments received through the Governments various Economic Security Payments this financial year are generally not counted as assessable income.

Assessable Income could include:

Salaries and Wages

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).

Allowances

Allowances and earnings from your payer may include:• car, travel or transport allowances• allowances for tools, clothing or

laundry

• dirt, height, site, risk, meal or entertainment allowances

• allowances for qualifications – for example, a first aid certificate

Sickness and Insurance Payments

Any payment you received under such a policy for loss of your income is usually considered assessable.

Lump Sums

Certain 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 profes-sional advice if you have any lump sum payments labeled A B C D or E on your payment summary.

Investment Income could include:

Rent

This is the amount of money you earn when you rent out your property.

Dividends

May include:

• dividends paid directly to you• dividends applied under a dividend

reinvestment plan• dividends that were otherwise dealt

with on your behalf, and• bonus shares that qualify as divi-

dends

Interest• Interest earned from financial insti-

tution accounts and term deposits unless you were a non-resident and have paid, or should have paid, non-resident withholding tax on that interest.

• Interest the Tax Office gave you or credited you with.

• If you opened or operated an account for a child and the funds in that ac-count belonged to you, or you spent or used the funds in the account as if they belonged to you, you must in-clude any interest from the account.

Government Income could include:

Pensions• Age pension• Widow B pension• Age service pension• Partner service pension• Disability support pension and you


have reached age-pension age• Wife pension and either you or your

partner was of age-pension age• Invalidity service pension and you

have reached age-pension age.

Other Government Allowances

These may include such income as:• Newstart allowance• Youth allowance• Mature age allowance• Partner allowance• Sickness allowance• Widow allowance• Bereavement allowance• Training for Employment Program

allowance; New Enterprise Incentive Scheme allowance.

Payments, supplements and benefits• Austudy payment• Carer payment• Education entry payment• Parenting payment (single)• Parenting payment (partnered)• Exceptional circumstances relief pay-

ment or farm help income support• Education payment of any of the

following and you were aged 16 years or older• ABSTUDY living allowance• payment under the Veterans’

Children Education Scheme• Income support supplement.

Capital Gains Tax

Capital Gains income could include any capital gain or capital loss on the disposal of certain assets.

Some relatively uncommon events or situations that may produce a capital gain or capital loss are:• An asset you own is lost or destroyed

(the destruction may be 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, sur-rendered 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 pay-ment from a unit trust or managed fund.

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

• You stop being an australian resident.

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

Business Income

Business income must also be included on your tax return. This may include earnings from you 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.

Exempt Income

There is a wide range of income that is not assessed for tax purposes. In gener-al, some types of Government pension’s allowances and other payments may not be deemed as assessable.

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 fall into the following broad categories:

Home Office

Some employees carry out work activi-ties in the home office. There are many

expenses that can be claimed for this as well.

These may include:• The decline in value of and repairs

to your home office furniture and fittings.

• Heating, cooling, lighting and cleaning.

Alternatively, the ATO have set a fixed rate of 26 cents per hour for home office expenses for heating, cooling, lighting and the decline in value of furniture in-stead of keeping details of actual costs.

Added to the expenses above, the following may be claimed on a pro

rata basis (apportioned for private and work use):• Calculators and electronic organisers.• Computers and computer software.• Answering machines.• Telephones.• Facsimile machines.• Mobile phones.• Pagers.• Hiring equipment.• Technical or professional publica-

tions.• Teaching aids.• Work-related telephone calls.


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.

Bank Fees

If you have fees incurred in the direct credit of salary into a bank account, these fees are normally deductible.

Travel Expenses

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

For a guide on the amounts that can be claimed, access www.ato.gov.au.

Motor Vehicle expenses

These are claimed when you have used your vehicle for work purposes. It does not include travel between work and home. However, the following trips may be included:• Travel directly between two separate

workplaces.• Travel for work-related purposes

from your normal workplace to an alternative workplace and back to your normal workplace or directly home.

• Travel between two workplaces or between a workplace and a place of business.

• Are classed as itinerant.

What is itinerant?

Essentially, you can claim travel expenses when you have a “shifting workplace”.

The case of Wiener (a School Teacher) and the ATO sheds some light on this.

Weiner was required to teach at a minimum of four different schools (‘web’ of work places) each day, and comply with a strict timetable that kept her on the move throughout each of these days.

Smith J, in the Supreme Court of Western Australia, concluded that travel was inherent in her employment because the nature of the job itself made travel in the performance of her duties essential, and said (ATC at 4010; ATR at 339):

‘...that travel was a fundamental part of the taxpayer’s work, is not open to challenge. Viewed objectively, it does not seem to me to be open to question that the taxpayer would not have been able to perform her duties without the use of her motor vehicle. ...it was a necessary element of the employment that on those working days transport be available at which-ever school the taxpayer commenced her teaching duties and that transport remained at her disposal throughout each of those days.’

Expenses can be claimed using one of four methods:

Method 1 – Cents per km

This is the most common method, allowing a claim of up to 5000 business km at set rate.

The table below shows the applicable rate, depending on your car’s engine capacity.

The other three methods are:

Method 2 – 12% of original value.

Method 3 – One-third of actual expenses

Method 4 – Logbook

It is suggested that you seek the advice of a Tax Agent prior to selecting a method.

Self Education Expenses

The expenses that you incur in complet-ing 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 em-ployee at the time you were studying.

Such expenses may include:• Textbooks• Student union fees• Stationery• Course fees• Travel expenses• Decline in value of equipment

There has been, however, some confu-sion of the deductibility of “Success Seminars”, often which involve elements of personal motivation and empower-ment. Whilst they vary from course to course, in general, the costs associated with this type of training are not tax deductible.

The ATO’s view is that “the material covered in seminars of this type is too general to be classed as relating specifi-cally to income-producing activities.”

It is also important to remember that usually the first $250 of these expenses is not claimable.

Engine capacity (ordinary car)

Engine capacity (rotary engine car)

Rate (cents per km)

1,600cc / 1.6 litre or less 800cc / 0.8 litre or less 63

1,601–2,600cc / 1.6–2.6 litre 801–1,300cc / 0.801–1.3 litre 74

2,601cc / 2.601 litre or more 1,301cc / 1.301 litre or more 75


Gifts and Donations (including School Building Funds)

Gifts and donations to can be claimed if they meet certain conditions. Firstly, 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 - money• Property < 12 months - property

purchased during the 12 months before the gift was made.

• Shares ≤ $5,000 - listed shares val-ued at $5,000 or less, and acquired at least 12 months before the gift was made.

• Trading stock - trading stock dis-posed of outside the ordinary course of business.

• Cultural gifts - property under the Cultural Gift Program.

• Heritage gifts - places included in the National Heritage List, the Commonwealth Heritage List or the Register of the National Estate.

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 din-

ners, even if the cost exceeds the value of the dinner (you can claim the lesser of $150 or 20% of the market value and certain auction items).

• 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 state:

A school building fund has the follow-

ing characteristics:• the fund is a public fund • the public fund is established and

maintained solely for provid-ing money for the acquisition, construction or maintenance of a building

• the building is used, or is to be used, as a school or college, and

• the building is used for that purpose by: • a government • a public authority, or • a non-profit society or associa-

tion.

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, worn together, identifies you as an employee of an organisation having a strictly enforced policy that makes it com-pulsory for you to wear the uniform while at work.

• A single item of distinctive clothing, such as a jumper or tie, if it is com-pulsory for you to wear it at work. Generally, clothing is distinctive if it has the employer’s 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 Sunscreen, Sunglasses and Sunhats.

Managing your tax affairs

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 lodgment, advice, costs of travel to and from the advisor and obtaining refer-ence works.

Other Deductions

Any expense incurred in earning income is usually deductible, so it is impossible to compile an exhaustive list. The fol-lowing are examples of “other” expenses that may be deductible for Educators:• Excursions, school trips and camps.• First aid courses.• Union and professional association

fees.• Dedicated stopwatches.

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• pest control• property agent fees or commissions• repairs and maintenance• stationery• telephone• water charges• travel undertaken to inspect the

property or to collect the rent.

If only part of your property is rented out, these expenses must be appor-tioned.


Rebates / Offsets

Rebates are different to deductions. Deductions reduce your assessable income, whereby rebates directly reduce the tax payable. They are also known as tax offsets. Usually, tax rebates can only reduce your tax payable to zero, with the exception of franking, baby bonus and private health insurance.

This is a complicated area of tax. Seek professional guidance. Below is a basic outline of the major rebates.

Education tax offset

The thresholds are up to $750 per Pri-mary School students and up to $1500 per Secondary School student.

Low income tax offset

Low income earners can have their tax offset by a maximum of $1350. That means that, if the taxpayer earns $15,000 or under, they effectively do not pay any tax.

Housekeeper tax offset

A housekeeper is a person who worked full time keeping house for you and cared for:• A child of yours aged under 21 years.• Your invalid relative.• Your spouse who received a disability

support pension.

This is a complicated area of tax. Seek professional guidance for your particular circumstances.

Invalid relative tax offset

In previous years, your taxable income and the separate net income of your dependant was used to assess your eligibility. From the 2009-10 income year, your and your dependant’s adjusted taxable income will be used. All other eligibility requirements apply, and remain unchanged.

Parent or spouse’s parent tax offset

If you maintained your parent, your spouse’s parent you may be entitled to a tax offset. The maximum tax offset is $1,489 for each dependent parent or spouse’s parent. For the 2008-09 income year, you are not eligible for the parent or spouse’s parent tax offset if your tax-able income is over $150,000.

From 1 July 2009 (2009-10 income year), instead of using your taxable income to determine your eligibility to claim this offset, your adjusted taxable income will be used. Adjusted taxable income includes your taxable income plus addi-tional income components. You will not be eligible for this offset if your adjusted taxable income is over $150,000.

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. You are usually entitled to a rebate if there is an amount listed at Section G on your yearly statement.

Age Amount of rebate

< 65 yr 30% of premium paid

65– <70yr 35% of premium paid

> 70 yr 40% of premium paid

Senior Australians tax offset

Males aged over 65 and females aged over 63 are usually entitled to a tax offset.

Mature age worker tax offset

To encourage people to stay in the work-force, the ATO provide a maximum $500 tax offset for workers over 55 who meet certain conditions. This offset does not apply to people who earn net income greater than $63,000 pa.

Net medical expenses tax offset

If net medical expenses for your family were over $1500 in the financial year, you can claim a rebate for 20 cents in every dollar greater this.

Net medical expenses are calculated by adding your out of pocket expenses and deducting any refunds (e.g. by Medicare or Private Health Insurance). This thresh-old will rise to $2,000 next year.

Franking tax offset

If you have been a shareholder, you usually receive dividends which have already had tax paid on them by the company. These are called franking credits. It is important to keep all share transactions record in a safe, orderly manner to allow for these calculations.

Termination Payments

An Eligible Termination Payment (ETP) is a form of lump sum payment paid by an employer or a superannuation fund. These payments are taxed at a lower rate. As each ETP is very different, a reg-istered tax agent should help you if you have received an ETP. They may include:• A payment in lieu of notice.• A payment for unused sick leave.• A payment for unused rostered

days off.• A ‘golden handshake’ whether paid

under contract, industrial award obligation or the employer’s desire to recognise past service.

• Compensation for loss of job.• Compensation for wrongful dismissal. • Redundancy payment that exceeds

the tax-free limit.* • A payment because of the employee’s

permanent disability.• Payment under an approved early

retirement scheme that exceeds the tax-free limit.


Do your 2010 tax NOW!

At Teacher Tax, we offer competitive rates on tax returns. Our system has been designed BY Teachers FOR Teachers.

There are 3 main ways of doing your tax with us:

Email

Simply send your details to [email protected]

By Phone

Call us on (02) 8006 5020 or contact our nearest office and discuss your details. We can then guide you through our easy step by step process.

By Post

Use this form and send us your documents. We have included a price guide below to let you know your fee.*

Simply fill in the personal details and as many other details as possible and post to

Teacher Tax, PO BOX 524, Macksville NSW 2447

* We guarantee the price of $99 (incl GST) per individual tax return. This is for individuals with relatively simple tax affairs. This includes all the deductions listed overleaf and if you answer questions 1 – 7 only. If you answer questions 8 onwards, please send us your docu-ments, but we’ll confirm a quote before processing. No obligation.

Personal Details

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Proceed to questionnaire overpage...

Liability Limited by a scheme approved under professional standards legislation.


QUESTIONS DETAILS PROOF REQUIRED

Who is your employer? Include any business who has given you a PAYG Summary.

PAYG Payment Summary

D1 Were you required to use your vehicle for work purposes?

YES / NO

#

If YES, place the approx km next to the appropriate box and complete D1A

Travel directly between two separate workplaces because you have two different employers – for example, you have a second job

#

Travel for work-related purposes from your normal workplace to an alternative workplace and back to your normal workplace or directly home – for example, if you need to go to a regional meeting/excursion

#

Travel between two workplaces or between a workplace and a place of business – for example, between two schools or between your school and the Exam Marking Centre

#

Any other reasons? Please outline. #

D1A Give the details of your car (incl number plate, make/model and engine capacity)

#

D2 Did you have any other travel expenses? (You cannot claim costs met by the school or costs that are reimbursed)

YES / NO

#

D3 Did you have any “work related clothing” expenses?

YES / NO

#

If YES, place the cost next to the appropriate box (write details below)

A compulsory uniform – a set of clothing that, worn together, identifies you as an employee of an organisation having a strictly enforced policy that makes it compulsory for you to wear the uniform while at work.

#

A single item of distinctive clothing, such as a jumper or tie, if it is compulsory for you to wear it at work. Generally, clothing is distinctive if it has the employer’s 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 pro-tect your ordinary clothes from soiling or damage – for example, laboratory coats or art smocks.

#

# Expense must be able to be proved if audited



D4 Have you incurred a self education expense? (There MUST be a direct connection between your self-education expense and your work as a teacher)

YES / NO

Please give brief description of course. #

If YES, place the cost next to the appropriate box.

Textbooks #

NOTE - You cannot claim costs met by the school or costs that are reimbursed

Student union fees #

Stationery #

Course fees #

Travel expenses #

Decline in value of equipment #

D5 Have you made any donations to registered charities?

YES / NO

#

D6 If you used a tax agent last year, how much were you charged? (claimable expense).

YES / NO

Please provide the agents name and address.

If you have incurred the following expenses, provide brief details (as well as cost)

D7 Calculators and electronic organisers

YES / NO

#

D8 Computers and computer software YES / NO

This is usually a pro rata expense - apportioned for private and work use.

#

D9 Answering machines, telephones, facsimile machines, mobile phones, pagers and other tele-communications equipment

YES / NO

#

D10 Excursions, school trips and camps YES / NO

#

D11 First aid courses YES / NO

#

D12 Hiring equipment YES / NO

#

D13 Technical or professional publica-tions

YES / NO

#

D14 Seminars, conferences and train-ing courses

YES / NO

#

D15 Teaching aids YES / NO

#




D16 Work-related telephone calls. YES / NO

#

D17 Union and professional associa-tion fees (usually listed on your group certificate – in which case, disregard)

YES / NO

#

D18 Dedicated stopwatches YES / NO

#

Please answer the following questions about your tax affairs

Q1 Have you earned interest from any source?

YES / NO

Bank interest - Call your bank to obtain the exact amount or use your July bank statement

Q2 If you have school children, did you have any eligible education expenses?

YES / NO

Receipts

Q3 Do you have a HECS or tax debt? If so, how much?

YES / NO

HECS Statement

Q5 Do you receive any Government pensions or allowances incl FTB?

YES / NO

Centrelink State-ment of Benefits - including Pensions, Job Start, etc

Q6 Do you have Private Health OR Income Protection Insurance (please specify)?

YES / NO

Private Health In-surance Statement

Q7 Has you family had net medical expenses of greater than $1500?

YES / NO

Details of expense and Medicare number.

Q8 Have you sold an investment property this year?

YES / NO

Purchase details and settlement details

Q9A Do you own shares? YES / NO

Dividend State-ments

Q9B Have you sold any shares this year? YES / NO

Sales Certificates

Q10 Do you have another source of in-come (e.g. second job/business)?

YES / NO

PAYG Payment Summary

Q11 Have you been charged any de-ductible interest? (e.g. investment loan, tax debt)

YES / NO

Bank Statements




Q12 Have you made any personal superannuation contributions on behalf of yourself or a spouse?

YES / NO

Superannuation Statement

Q13 Is there any other information that you feel will assist with the preparation of your return?

YES / NO

Q14 Do you have dependant children? (please provide dates of birth and names)

YES / NO

1

2

3

Q15 Do you have (or a share in) an investment property?

YES / NO

If YES, please provide details on a separate sheet. We will call you at a convenient time to discuss specific details.

AGREEMENT – Please sign and send

I, ___________________________________, of _________________________________________, Name Address

hereby direct & instruct Teacher Tax to provide the following services and carry out the following work and to advise on my behalf, from time to time, as and when they fall due or as requested by me.1. Accounting and management

services.2. Taxation planning.3. Income tax returns.

I personally undertake and guarantee to pay all professional fees and disburse-ments as agreed on behalf of myself or any entity previously mentioned. This does not diminish my rights.

AUTHORITY TO DEDUCT

At my request and in consideration of not being required to pay in advance, I hereby direct and authorise Teacher Tax to receive, to bank and to deduct from ANY tax refund cheques or any other monies received from me (including third party cheques) or on my behalf, all fees in regards to tax returns prepared, accounting work performed, advice provided, disbursements, and any other fees incurred on my instructions, or the instructions of any person or entity listed below, such as solicitors fees, barrister fees, valuers fees, and any fees

or premiums paid on behalf of;1. Myself.2. Any of my relatives, including my

husband/wife (defacto or other-wise), son, daughter, brother, sister, mother, father, mother-in-law, father-in-law etc.

3. Any other person or entity who may be related to me or of which I may be connected or associated with. I understand that a service fee as set by Teacher Tax at the appropriate time will be charged.

I warrant that I have authority to give the above undertakings and authorities with regard to payment of your fees.

I understand that Teacher Tax will remit the balance of all monies due to me after deduction of each of the fees paid, etc as described above as soon as is practicable after the relevant bank clearance has been obtained. This authority shall remain in force in respect of future years unless revoked in writing. This does not diminish my rights.

Signed Client _______________________________________________ Date ______________________

Liability Limited by a scheme approved under professional standards legislation.

NTEU contact details

National Office

Phone: (03) 9254 1910

Fax: (03) 9254 1915

Address: PO Box 1323, South Melbourne VIC 3205

Email: [email protected]

Web: www.nteu.org.au

Branch & Division contact details available at www.nteu.org.au

Teacher Tax contact details

NSW & National

PO Box 524, Macksville NSW 2447

Phone: (02) 8006 5020

Fax: (02) 8580 5073 (central fax system)

Email: [email protected]

Web: www.teachertax.com.au

Victoria

PO Box 550W, Ballarat West VIC 3350

Phone: (03) 9014 9590

Western Australia

Phone: (08) 6102 0560

Head Office

PO Box 831, Campbelltown NSW 2560

NTEU Tax Guide 2010

Documents

tax affairs

tax pay

tax system

tax agent

education tax offset

franking tax offset

housekeeper tax offset

nteu tax guide