03/07/2024
So your mate at the pub got a large refund and you are wondering why your refund is so much less. As a tax agent, I could give you a multitude of reasons why this could be the case.
Firstly, he (or his accountant) could be dodgy and claiming deductions that he didn't actually incur. Feel free to use his accountant. I will do my best to maximise your deductions and get you the best possible refund, but I won't risk my backside to save you a few dollars.
Okay, so he isn't dodgy...here are just a few things that could affect his and your refunds.
• Too much tax was withheld from your mates pay during the year. This is common for people working lots of overtime or their hours change significantly week to week. All this means is that your mate was receiving less in hand throughout the year. Ask your employer to withhold an extra $50 each week and you will have paid an extra $2,600 in tax each year.
• You claimed the tax free threshold on your second job. This can bite if you go over the tax free threshold and have claimed it for both jobs.
• Your friend has more out of pocket costs related to his job. It's fantastic that he is getting some of it back, but I'm sure he would have preferred not spending his money in the first place.
• Your mate didn't work a full year. Employers withhold tax assuming their employee will earn the same amount each week, so if they earned $30K in six months they'd pay $5,500 in tax in that time (the assumption being their income would be $60k for full year). If they then stop work and earn no more income they would only pay tax on the $30k (approx $2,500) resulting in a $3K refund.
• You didn’t pay much tax. This is very common especially with part time workers and juniors. Just remember you can’t get back any more tax than what you have paid.
Tax can be confusing....so don't always trust what you hear at the pub.
Feel free to speak to me about how you can get the best possible refund, and remember, I am here to help.
