2021 Tax-Time Checklist




So, you thought your 2020 Tax Return was complicated - welcome to 2021!


With all the continued changes around COVID-19 with income, allowances, government incentives and the deductions that have been impacted by it, this year more than ever is not the time to just Do-It-Yourself!


Rest assured your 2021 tax return deductions will be under more scrutiny than any year ever before. Even more than last year - if that was even possible.


But, as always we have your back.


The following is the COMPLETE tax return checklist. We know it is long - but we have done all the hard work for you. It includes the income that you need to declare and the deductions you can claim.


Lets get started....

To ensure you are prepared for your appointment make sure that you have the following information available upon booking:


  1. A copy of last year’s tax return

  2. Bank account details where you would like the refund to be paid to

  3. Photo Identification - new clients only

  4. Income – see breakdown below

  5. Deductions – see breakdown below

  6. Spouse details (married or defacto) – Full name, Date of birth and Taxable income for the year

  7. Number of dependant children

  8. Amount of child support you have paid in the year

Lets break down Income and Deductions....

Income Includes


  • Salary or Wages


Did you know that your employer does not need to supply you with a Payment Summary if they are reporting directly to the ATO?


PAYMENT SUMMARY CHANGES: Please see important information on the changes to Payment Summaries - these are now known as Income Statements you can find this here


If your employer has provided you a copy please let us know and have this available upon request, and if applicable any paid parental leave payments


If you have received JobKeeper payments this will be reported on your Payment Summary


  • Allowances, earnings, tips, director’s fees etc.


This is usually located on your payment summary. Please be aware that receipt of an allowance does not automatically entitle an employee to a deduction for expenditure to which the allowance relates (e.g. tool allowance).


  • Employer Lump Sum Payments


These payments are in respect of unused annual and long service leave paid out on termination of employment. Label A and B of the client’s PAYG payment summary should contain the relevant information. Also, obtain and attach a copy of a statement of termination from the client’s employer.


  • Employment Termination Payments (ETPs)


Please provide a copy of any ETP payment summaries and employer termination statements.


  • Australian Government allowances and payments like Newstart / JobSeeker, youth allowance and Austudy payment


Provide details of all youth allowances, Newstart / JobSeeker, sickness allowance or special benefit, or other educational or training allowances. (Please Note: paper copies are no longer sent by Centrelink and will need to be obtained via my.gov)


  • Australian Government pensions and other allowances


(Please Note: paper copies are no longer sent by Centrelink and will need to be obtained via my.gov)


  • Australian annuities and superannuation income streams


Provide details of taxable and rebatable components of pension.


  • Australian superannuation lump sum payments


Superannuation lump sums paid from a taxed source to a person aged 60 or over are tax free. Lump sums paid to persons under 60 are still taxable. Please provide details of these.


  • Gross interest


Interest that has been received or credited in the 2021 Financial Year, from your Bank or Financial Provider


  • Dividends


Unfranked, partly franked and fully franked dividends are assessable for taxation purposes. Please provide copies of your dividend statements.


  • Employee share schemes (ESS)


Please provide details of any Employee Share Schemes.


Please note the discount given on the ‘ESS interest’ (being a share or a right to acquire a share) under the ESS is assessable for taxation purposes unless the deferral concession applies. This assessable discount may be reduced by $1,000 where certain conditions apply.


  • Sole Trader, Partnerships and Trusts


Please provide all income and expenses related to any sole trader business activity, this can be via bank statements, excel spreadsheets or profit and loss reports from accounting software.


Please provide all details regarding partnership, trust or a managed investment trust fund payment and type of income received are required.


In the case of a Partnership and Trading Trust please provide a copy of the tax return. In the case of Managed Trusts, please provide the tax summary from your Shares portfolio provider or Broker


  • Capital Gains


In the case of any possible Capital Gains you will need to provide:


  1. a description of the asset

  2. the purchase date

  3. the purchase cost

  4. date and amount of any expenditure incurred by the taxpayer that forms part of the asset’s cost base including eligible incidental costs

  5. the sale date (or exchange of contract date if earlier)

  6. the sale proceeds amount.


  • Foreign source income and foreign assets or property


Provide details of country, amount received, exchange rate utilised, foreign tax withheld.


  • Rental Income


Provide details of:

  1. rental income earned

  2. interest charged on money borrowed for the rental property

  3. details of other expenses relating to the rental property

  4. details of any capital works expenditure to the rental property.


Other income

Please provide details of any of the following that has been received during the year including:


  1. a non-qualifying component of an ETP

  2. lump sum payments in arrears

  3. foreign exchange gains

  4. royalties

  5. certain scholarships, bursaries, grants

  6. any assessable balancing adjustments on depreciating assets

  7. jury duty service fees

Deductions Include:

REMEMBER THE THREE GOLDEN RULES


You must have paid for the expense and not been reimbursed, there must be a direct connection to earning your income and lastly you must have a record to prove it

  • Work Related Car Expenses


Since the 2016 Financial year there are only 2 methods available to use

1. Cents per kilometre method:

This claim is based on a set rate for each business kilometre travelled which is 68c (increased from 66c in the 2018 year) The taxpayer is able to claim costs by applying the set rate up to a maximum of 5,000 kilometres, "without a logbook"

**Please note you will still need to justify that these kilometres have actually been travelled - that means that the ATO will require you to substantiate your kilometre claim, they can and will call your employer to find out if you are required to use your motor vehicle. You will also need to show your workings on how many kilometres have been calculated.

**To make sure you get it right we recommend you always keep a logbook! At the very least, get a signed letter from your employer stating that you must use your own car

2. Logbook method:

This claim is based on the business use percentage of car expenses. Ensure log is kept for 12 consecutive weeks and business use percentage did not vary more than 10%. The resulting business use percentage may then be applied to all car expenses to calculate a deductible amount. The log book must be renewed every 5 years.

**Please note you must have a starting and ending odometer for every year claimed for the log book to be valid

IMPORTANT: if you have been working from home due to COVID-19 restrictions the ATO will be looking closely at your Motor Vehicle Deductions in that period