"Unveiling the Reasons Behind Unexpected Tax Debts This Year"
Did your Notice of assessment bring unwelcome surprises this year?
Discover 6 reasons why your 2023 tax refund is so low.
- Expired Tax Offsets: This year, several tax offsets expired or changed criteria, affecting refunds. For instance, the LMITO offset ended, impacting potential refunds. That means you will receive $1000-$2000 less this year
- HECS/HELP Repayments: Higher income raised repayment thresholds for study loans. Not informing employers of proper withholding led to repayment issues, you must tick no threshold and increase payments for HECS.
- PAYG Withholding Concerns: Insufficient tax withheld due to job changes, incorrect claims, or government allowances can result in unforeseen tax debts, if you have two jobs in any tax year never choose the tax-free threshold option on the second job, regardless if you started the one later than the other in a financial year.
- Income-Related Factors: Sole traders, partnerships, trusts, and diverse income sources require accurate PAYG installments to avoid tax debt surprises.
- Investment Income Impact: Earnings from assets, dividends, or sharing economy activities influence tax thresholds and Medicare levies, and will increase the tax payable meaning you will receive a low tax refund.
- Miscellaneous Factors: Changing health insurance rebates, exceeding super fund limits, and inconsistencies in tax data can contribute to unexpected tax debts.
Understanding these reasons helps navigate potential tax debt pitfalls.
Stay informed to manage your finances effectively.