5 things to do before June 30 to boost your tax refund

"What do I need to do before tax time?" It's a common question many Australians are asking with tax time just around the corner. So, let's break the answer down into two parts: some important information you should know and what you can do between now and June 30 to boost your refund. 

What you need to know 

Tax cuts increase your tax home pay, not your refund: The new Stage 3 tax cuts begin on 1 July, but they won't boost your tax refund. Instead, you should see a bump in your take-home pay. 

Work-from-home claims will be closely scrutinised: If you plan to claim the cents per hour rate for working from home this year, you need a detailed record of every single hour you worked at home. The days of a diary covering a four-week "pattern of use" are gone. Our tip: Ask your employer if they can provide you with a report from their payroll system detailing days and hours worked at home versus in the office. 

Smaller refunds are likely to continue: In 2023, many Australians saw refunds $1,000 to $1,500 lower than they were used to. This is due to the government ending the low and middle income tax offset. In 2024, if your circumstances remain similar to last year, you should expect a similar (and likely smaller) refund than you were used to in the early 2020s. 

5 things you can do now to improve your tax refund

1. Make any bigger deduction purchases now or prepay expenses for next year
The 2024-2025 financial year brings the Stage 3 tax cuts with most Australians seeing their marginal tax rate drop. This means the value of each dollar claimed as a deduction will also drop. The table below shows what that looks like in practice for someone with $10,000 of deductions claimed this financial year versus next.

To maximise the value of your deductions (and boost this year's refund) it may also make sense for you to make any big deduction purchases now or prepay some expenses for the next financial year. Examples include: 

• Repairs to a rental property
• Prepaying interest on rental or investment loans
• Paying invoices for self-education related to your job
• Paying for upcoming work-related travel
• Prepaying annual bills such as union, membership or professional registration fees

Important tip: Be careful with the end of financial year (EOFY) sales for things like tools or new computers. Any item you purchase that costs more than $300 will need to be depreciated. This means a purchase in May 2024 gives you only a tiny benefit this year, with most of the depreciation (and therefore deduction) occurring next year. 

2. Delay income until next financial year

This is almost the reverse of the first tip, and it may sound counter-intuitive, but delaying any income such as a salary bonus or capital gain until after the stage 3 tax cuts kick in could put more money in your pocket.  

For example, someone with an annual income of $90,000 would pay 2.5% less tax on any bonus or capital gain after 1 July than they would if they receive it before 30 June, while someone earning $135,000 would pay a whopping 7% less tax.  

3. Top up your (or your spouse's) super

If you make any personal after-tax super contributions to your super account, you can claim a tax deduction on your tax return. Just make sure you complete the "notice of intent to claim a tax deduction" form with your superannuation fund (and receive confirmation from them) before you do your tax return. 

In addition, if your spouse earns less than $40,000 income (the sum of their assessable income, plus reportable fringe benefits and reportable employer super contributions), and they have not exceeded their non-concessional contributions cap for the year, then you may be able to claim a tax offset of up to $540 per year if you contribute to your spouse's super account. 

4. Offset a capital gain with a loss of any dud shares/investments

If you already sold shares or investments this year which made a capital gain and you have plans to sell some underperforming investments, consider timing the sale to occur before 30 June. 

This is because any capital loss you make in this financial year can be used to partially or fully offset a capital gain that you'd be required to pay tax on in your next tax return.

5. Sweat the small stuff 

Small deduction purchases made now (under $300) can be claimed in full on this year's tax return and will net you a bigger return than if you claim the same item next year. So, if you need a new computer monitor or office chair, consider buying it before 30 June to claim it in full on your tax return this year. 

Also, run back through your credit card and bank statements looking for those small incidental work-related purchases like stationery, printer ink, car parking etc. While $10 here or there doesn't seem like much, over the course of a year this can add up to hundreds of dollars of additional deductions you could miss out on. 

Important note: The information contained in this article is general in nature and should not be taken as detailed advice. Before making any decisions based on the information above, Etax suggests speaking directly to a tax agent who can assess your individual circumstances and ensure you're getting the best possible tax outcome.