Today, I finalized a tax return for a client, maximizing his tax refund and securing a return of over $4,000 while also assisting him in removing the Medicare Levy. Ordinarily, one would be quite content with such a result. However, in this unique situation, the client seemed dissatisfied and expressed a desire for more. Before I had the chance to explain further, he abruptly left, leaving behind a negative review on Google to convey his frustration.
In this article, I will share his post and provide insights into how the tax return system works. It’s crucial to understand the process and the factors that contribute to a maximized tax refund, ensuring transparency and client satisfaction.
I will share his post in this article and also try to share with you how the tax return system work.
Unhappy tax client want more tax refund than what he actually should get
The tax return system in Australia is based on PAYG or withheld system in which your employer will withhold tax amount by the relevant tax bracket.
At the end of the financial year, when we are helping you to prepare the end-of-year tax return, it is our job to maximize the work-related deduction for you.
But obviously, deductions are only deductible if you have maintained the valid evidence and it is work-related.
A good responsible tax agent will use their professional judgments to determine whether the deductions are the high end or not. If they are on the high end, they will normally advise the client of the issues.
In this particular instance, I noticed the deductions that the client wanted to claim were on the high end, and I informed him of the importance of maintaining the proper invoice records.
At the end of the day, I need to be responsible for all of my clients.
I am a specialist in tax audit, and know the full consequence if the client gets audited by ATO, and if ATO finds out systematic error in the firm, then all other clients in that firm might face the possibility of being investigated as well. Normally I will also advise the client of the 5-year rule in which you need to keep the invoices, and the car expenses using cents per km.
But at the end of the day, the tax refund is determined based on the tax on the adjusted taxable income after the work-related deduction, if it is less than the PAYG or withheld tax, you will get the refund, if not then you need to pay the tax.
For example, the income of $50,000 is supposed to have a tax of $7,797, and your employer had withheld say $4,000, however, if you can have a $5000 work-related deduction, then the new adjusted taxable income of 45,000 will have a tax of $6,172, hence the difference of the tax withheld of $4,000 and the actual tax of $6,172 will mean you have to pay ATO the difference of $2,172, however, if your employer has withheld say $8,000 then you will get a refund of $1,828.00.
Our firm stands by a maximum tax refund guarantee. If you can provide written evidence that other tax agents can secure you a greater refund than ours using the same data you provided to us, we are committed to refunding your fee and offering an additional $100 as a reward to you. For further details or inquiries, please give me a call at 0410-829-900. We are dedicated to ensuring you maximize your tax refund and providing a service that exceeds your expectations.
Is travel expense deductible
I had also advised the particular client of the Medicare exemption and ways to get rid of the Medicare levy, really hope that he will tell his newly appointed tax agent of the issue, and they know how to handle the exemption process correctly, as if it done wrong, it will attract penalty from the ATO.
If you have any questions in relation to your tax return, please feel free to give us a call on 0410-829-900.