Three Ways Parents Can Maximise Their Tax Reduction Options

There are only a couple of months left before this financial year comes to an end in Australia. So, if you want to make any changes to maximise your deduction opportunities when you file your tax return, now is the time to make those changes. As a busy working parent who has not kept up to date with recent tax deduction news, it is time to brush up on how to reduce the chances of you owing any money to the ATO after you file your return. Here are three changes you can make now which impact your tax return.

Salary Sacrifice Education Costs

Sending a child to a private school is not a cheap endeavour, so use this to your advantage by reducing your taxable income amount. Salary sacrifice means the school fees are deducted from your gross income, not your after-tax income. This means that the amount of tax you pay is lower because your gross income is reduced by the items you salary sacrifice. Talk to the person in charge of preparing the wages at your place of employment to see whether salary sacrifice is offered as a payment option.

Child Care Subsidy

Having children in childcare means that the government will contribute a little towards this cost. However, the amount you are eligible to receive and the income limits which apply to your family can be a little complicated to understand due to the subsidy's tie-in to income levels and activity levels of parents. The activity level of a parent does not necessarily relate to the number of hours a parent works at a traditional job. Activity levels also related to volunteer and self-employment activities. The ideal way to find out exactly your family's subsidy level is to meet and discuss this with a tax professional. Since child care paid out is an allowable deduction, it is important you get this figure right.

Child Related Deductions

Have you made a donation to your child's school as part of a fund-raising drive this year? You probably would have paid for a stack of stationery at the start of the school year. Make sure you keep these receipts and include them as deductions when you prepare your tax return as they are legitimate deductible expenses.

If you have any doubts about your tax return this year, take it to a taxation service for discussion and checking. Professionals know exactly how to make sure you are making the most of your tax reduction options.