Common mistakes/misunderstanding in individual returns

shuangchao

I would like to address the following common misunderstandings in individual tax returns,
1. Everyone's tax situations is unique on its own, it is very difficult to compare your own return with your friend's return.  two people could on be exactly the same salary and almost identical personal situation, however, one person may be getting back alot more tax simply because there were more tax been withheld.
2. the $300 deduction without written evidence rule is not on a per transaction basis (e.g. we can't claim $9000 deduction and say its for 30 different expenses each no more than $300), and it is not on top of any existing dedutions.
3. audits on indivdual returns do happen, therefore we must be able to substantiate all our claims. one common mistake  is that alot of people claim 5000km in car expenses regardless of the nature of their job. car expenses is one of the targeted audit area, if your job requires no more than travel from home to work then back home, it would be very difficult to substantiate a 5000km claim.

With straight forward individual returns, attempt it on e-tax. if there is any questions or uncertainties, contact an accountant who can explain to you what you can claim and what are not deductible based on your own circumstances. this way, you'll be more confident  when you prepare your own return next year.

丹儿

thanks for sharing David.

丹儿

David, With work related travel expense, we can claim the actual running costs occurred for the car owned by someone else if it's work related. What sort of records we should keep for audit?
The total deduction amount is manually estimated. Say,  work related travel kms is about 150kms per month. The petrol costs about $30.00 for that 150kms. taxpayer claimed $360.00 deduction for the whole year.

shuangchao

原帖由 丹儿 于 2009-10-21 16:13 发表
David, With work related travel expense, we can claim the actual running costs occurred for the car owned by someone else if it's work related. What sort of records we should keep for audit?
The tota ...

the records you need to keep in this case is how you arrived at the 150km, e.g. 1 trip per week, each trip is 75km for total of two weeks.  or alternatively a more accuate diary travel record. (petrol receipts could be used to further support your claims)

丹儿

hope the self estimated travel diary is ok for record keeping purpose. really hard to keep all petrol receipts for the whole year only for claiming $360.00 deduction.
Thank you David.