Lodging Your Tax Return: Episode Two – What is Income?
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In this episode ‘What is income?”, ATB Director Jim Vass explains the various income classifications.
Understanding the different types of income is important when lodging your own income tax return with the Australian Taxation Office (ATO).
The timeframe for lodging your own income tax return is from 1 July to 31 October each financial year. Extensions are not granted to individuals; however, your tax accountant can seek one for you.
What is income?
As Jim explains, clearly identifying sources of income in your tax return is important to avoid potential fines or penalties.
There are various types of income that you need to declare to the ATO on your tax return.
The following are considered types of income:
- salary or wages recorded in PAYG summaries
- lump sum payments
- interest from savings
- dividends from investments
If you’re having trouble working out what is considered income, a member of the ATB team is able to assist you lodge your own tax return.
Does your income match the ATO’s records?
The ATO will have a record of how much income you received for a particular financial year and from where, e.g. interest from a savings account.
For this reason, it’s important to be accurate when itemising the various streams of income you receive.
Other forms of assessable income can include:
- tips, gratuities and other payments for your services
- allowances for things like car, travel, clothing, and laundry
- bonuses and overtime
- sales commission
- Centrelink pension or payment
Let ATB help you
Declaring income is not always a straightforward task. Share schemes are an example of a source of taxable income that people find difficult to report on.
To avoid potential omissions in your tax return, a member of ATB’s experienced team can provide advice to help you lodge your own income tax return.
Coming up Next – Episode 3 – Share Schemes
In the next episode, Jim explains what share schemes are and how they impact your taxable income.