Latest news with #taxseason
News.com.au
09-07-2025
- Business
- News.com.au
Tax return spending spree: Aussies spend $1.8bn before refunds
Australians have already spent an estimated $1.8bn of their expected tax return despite not the ATO warning Australians shouldn't even bother lodging a return until after July 14. New research by ING shows Australians are jumping the gun this tax time and have already spending up big after two years of cost of living pressures. ING survey data shows a quarter of Australians who think they will be getting a refund this tax time have already spent some of it. A further one in 10 have spent it all. The average amount Aussies have already spent in anticipation of their tax refund is $1,529 – adding up to an estimated $1.8 billion nationwide in pre-emptive spending. This comes as Aussies are expecting around $1177 in their tax return adding up to $11.2 billion nationwide. ING head of consumer and market insights Matt Bowen told NewsWire Australians are excited about their tax return and are looking to splurge. 'People are expecting a refund, around $1177, which is enough to excite people given a cost of living crunch and some people are pulling the trigger a little bit early, happy to spend the money before its even arrives in their bank account,' Mr Bowen said. 'I would say it is a function of having a few years of difficult cost of living. 'We certainly see tax time as a bit of a windfall of the household budget and people are getting excited and spending it quickly.' But Australians spending their tax return on indulgent purchases is nothing new. ING research shows two in five Australians have used their tax return at some point to splurge on items with new phone or laptop, new furniture, fine dining, concert tickets and collectibles, like Labubus, topping the list for what taxpayers are buying. But not all of the early splurge has been on discretionary spending. Around 41 per cent say some of the money will be put towards savings, while 24 per cent will cover essential expenditures and 12 per cent are adding the money to their mortgage. Australians also plan to use the money to invest or add to their super. ING research about tax payers already spending their refund comes as the tax man asks Aussies to slow down and wait until at least July 14 before submitting their tax return. ATO Assistant Commissioner Rob Thomson said employers have until July 14 each year to finalise payroll data, urging Aussies to wait until late July allows for the ATO to prefill information in your tax return. 'We know doing your tax return is something to tick off your to-do list each year, but there's no need to rush. The best time to lodge is from late July once everything is ready,' Mr Thomson said. 'We pre-fill information from your employer, banks, government agencies and health funds into your tax return to help you get it right the first time – regardless of whether you use a registered tax agent or lodge yourself.'
Yahoo
07-07-2025
- Business
- Yahoo
Don't expect a speedy tax refund in 2026 from an understaffed IRS
The Trump administration's 2025 cost-cutting campaign at the IRS was all too successful, according to an internal watchdog report. As a result, the agency may struggle through the 2026 tax season. And taxpayers may suffer. The IRS lost 26% of its 102,000-person workforce to layoffs and buyouts this year through early June, amid a larger effort by the Trump administration to shrink the federal government. The figure comes in a June 25 report from Erin Collins, the national taxpayer advocate. The 2025 tax season ended as 'one of the most successful filing seasons in recent memory,' Collins said in a statement that accompanied the report. 'But with the IRS workforce reduced by 26%, and significant tax law changes on the horizon, there are risks to next year's filing season. It is critical that the IRS begin to take steps now to prepare.' The IRS processed 138 million returns in the 2025 filing season and issued 86 million refunds, with an average refund of $2,942. Few of the tax agency's critics predicted a successful 2025 tax season. The IRS went through five commissioners in four months, Collins writes in the report, 'and many of its most experienced leaders chose to accept one of the voluntary departure options.' Now comes a bigger challenge. A mammoth legislative package, approved by the Senate on July 1, includes dozens of tax cuts, tax-cut extensions and other tweaks to the tax code. The tax agency's Information Technology unit will have to reprogram IRS data systems to reflect those changes, if they become law. But that unit has lost 27% of its staff, Collins reports. The Taxpayer Services unit will have to handle the predicted deluge of telephone calls from befuddled taxpayers. That unit has lost 22% of its staff, more than 9,000 employees. To avoid potential chaos, according to a report summary, 'the IRS will need to rapidly hire and train thousands of new Taxpayer Services employees before the 2026 filing season to process returns and deliver timely refunds.' Other taxpayer advocates echoed those concerns. 'You can't make those kinds of deep cuts without harming customer service,' said David Kass, executive director of the nonprofit Americans for Tax Fairness. 'Let's be clear: This is a mistake of the administration's own making.' Collins made her remarks in a 75-page National Taxpayer Advocate Objectives Report to Congress. The report recommends several agency objectives. Among them: Create fully functional IRS online accounts. Right now, taxpayers 'generally cannot file tax returns, view most notices, or respond to notices through their online accounts,' according to the report summary. 'Until recently, they could not make payments. As a result, only about 10% of taxpayers have taken the time to establish online accounts.' Streamline taxpayer case management. Today, the IRS 'stores taxpayer data on about 60 distinct case management systems that generally cannot communicate with each other,' according to the report summary. When a taxpayer calls, IRS representatives often search through multiple systems to find their data, while the taxpayer waits on hold. The Trump administration set out to cut thousands of jobs at the IRS this year, aided by Elon Musk's Department of Government Efficiency, with an eye to saving money. Buyouts and layoffs, together, thinned the IRS workforce from 102,113 to 75,702, according to the advocate's report. The cuts, alone, would have posed a formidable challenge to the IRS as it ramps up for the 2026 tax season, agency observers say. But now, with the expected passage of Trump's tax bill, the smaller staff may have to cope with an onslaught of taxpayer inquiries about new rules on overtime, tips and car-loan interest. 'Now, maybe the cuts to staffing alone may not have had a huge impact on the filing season if all else held equal,' said Alex Muresianu, a senior policy analyst at the nonprofit Tax Foundation. 'But having the big staffing cuts the same year as a bunch of major tax changes is a dangerous mix.' One apparent casualty of the cuts is Direct File, a new IRS program that allowed millions of Americans with uncomplicated taxes to file returns at no cost. Piloted in a dozen states last year, Direct File expanded to 25 states in 2025. But now, the program may be over. The Trump tax bill would empanel a 'task force on the replacement of Direct File.' Perhaps the Direct File staff knew what was coming. In the first half of 2025, according to the advocate's report, the unit shrank from 27 employees to five. This article originally appeared on USA TODAY: 'Where's my refund?' Tax changes may bury understaffed IRS in 2026
Yahoo
07-07-2025
- Business
- Yahoo
Common tax return mistake revealed as Aussies claim $3,500 of deductions: 'They miss out'
Tax time is officially here and Australians are being urged to make sure they are claiming all the deductions they are entitled to. The average Australian has claimed $3,518 worth of tax deductions in previous years and tax agents say there are some easy deductions people forget each year. Tax App director Alesha Masaud said she often sees people miss out on tax deductions for work-related assets and equipment. The Australian Taxation Office (ATO) allows you to claim a deduction for tools or equipment that you use for work. 'Anything that's an asset, so for example laptops, phones, monitors, printers, scanners, office chairs, even storage or filing systems,' Masaud said. RELATED Major $1,500 ATO warning for Aussies lodging tax returns on July 1 ATO reveals highest paying jobs that don't require university degree: '$130,000 ' CBA, NAB, ANZ reveal $200,000 move borrowers making after RBA rate cuts For assets under $300, the accountant noted you can claim the full amount immediately. But for assets over $300, you will have to depreciate them over the useful life of the asset. You can use the ATO's depreciation and capital allowance tool to work out your claim, or you can manually calculate the decline in value using the prime cost method or diminishing value method. Chartered accountant and Tax App managing director Fahad Gul said another common mistake he saw was around deductions for personal superannuation contributions. 'They have been contributing into super and do not lodge a notice of intent and they miss out on a tax deduction,' Gul told Yahoo Finance. 'Super gets taxed at a 15 per cent flat rate. So high-income earners, people who are in the 30 per cent plus brackets, would definitely want to do that. However, people who are on a lower tax bracket may choose not to claim a deduction for the extra super contribution.' The form has to be lodged with your super fund on or before the day you lodge your tax return, or the last day of the income year after the year you made the contributions. To help you prepare your tax return, Masuad and Gul have shared a checklist of common tax deductions that you may be able to claim. Remember, you'll need to have records to prove you incurred the expense, usually a receipt. Vehicle and travel expenses (logbook or cents/km) Home office expenses (fixed rate or actual cost) Work-related phone and internet (proportional use), not to claim if claiming fixed rate WFH Tools and equipment used for work Uniforms and protective clothing Union fees or professional memberships Work-related self-education expenses Conference or seminar costs Journals, trade subscriptions or apps used for work Tax agent or accounting fees Interest on investment loans Income protection insurance (outside super) Donations over $2 to registered DGRs Bank fees on investment accounts Dividend and share management fees Work and office equipment Laptops, phones, tablets Monitors, printers or scanners Office chairs, desks, ergonomic equipment Tools or machinery specific to your job Storage or filing systems for work Camera, lighting or recording equipment (for content creators) Home office assets Office furniture Modem or router Computer hardware or accessories Vehicle, if used for work Car depreciation (logbook method required) Ute, van or motorbike used for work (depreciation) Personal concessional contributions, must lodge notice of intent with super fund The ATO has handy occupation and industry-specific guides you can use to see what specific tax deductions might be available to while retrieving data Sign in to access your portfolio Error while retrieving data
Yahoo
03-07-2025
- Business
- Yahoo
The Top 5 Analyst Questions From H&R Block's Q1 Earnings Call
H&R Block's first quarter results were met with a negative market reaction, despite the company surpassing Wall Street's revenue and non-GAAP profit expectations. Management attributed revenue growth to higher net average charge (NAC) in the U.S. and increased company-owned Assisted return volumes, while acknowledging challenges in international operations and a highly competitive do-it-yourself (DIY) segment. CEO Jeffrey Jones emphasized the impact of a late-season client surge and a continued industry shift towards Assisted tax preparation, highlighting, 'We experienced record-high volumes in our tax offices in the final two days of the season compared to recent history.' Is now the time to buy HRB? Find out in our full research report (it's free). Revenue: $2.28 billion vs analyst estimates of $2.25 billion (4.2% year-on-year growth, 1.3% beat) Adjusted EPS: $5.38 vs analyst estimates of $5.17 (4.1% beat) Adjusted EBITDA: $1.01 billion vs analyst estimates of $984.2 million (44.4% margin, 2.8% beat) The company reconfirmed its revenue guidance for the full year of $3.72 billion at the midpoint Management reiterated its full-year Adjusted EPS guidance of $5.25 at the midpoint EBITDA guidance for the full year is $997.5 million at the midpoint, in line with analyst expectations Operating Margin: 43%, in line with the same quarter last year Market Capitalization: $7.48 billion While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention. Kartik Mehta (Northcoast Research) questioned the shift from DIY to Assisted filings and why the Assisted segment continues to outpace expectations. CEO Jeffrey Jones attributed this to consumer uncertainty and the importance of expert help during tax season. Scott Schneeberger (Oppenheimer & Co.) asked about the decline in franchise operations and the impact of franchise buybacks. CFO Tiffany Mason explained that most of the decline was due to buybacks, not organic weakness, and highlighted the attractive returns from this strategy. Scott Schneeberger (Oppenheimer & Co.) also inquired about the competitive dynamics in the DIY segment, especially around paid vs. free filers. Jones stated that H&R Block focused on paid clients rather than pursuing volume for free filers amid heavy competitor promotions. George Tong (Goldman Sachs) addressed the difference between H&R Block's Assisted volume growth and the broader industry's performance. Jones acknowledged improved conversion and retention, particularly among higher-value clients, but noted the company has more work to do to gain share. Alexander Paris (Barrington Research) probed the effect of tax filing deadline extensions on volumes. Mason clarified that most extensions shift some volume into the next quarter, but the overall impact is not material to full-year guidance. In the coming quarters, the StockStory team will monitor (1) the effectiveness of H&R Block's initiatives to drive retention and conversion among higher-value Assisted clients, (2) adoption and monetization of digital and AI-enabled services in both DIY and Assisted channels, and (3) the impact of further franchise buybacks and integration on operating performance. Shifts in consumer filing timing and regulatory developments will also be important markers for tracking strategic progress. H&R Block currently trades at $55.90, down from $61.64 just before the earnings. At this price, is it a buy or sell? Find out in our full research report (it's free). Market indices reached historic highs following Donald Trump's presidential victory in November 2024, but the outlook for 2025 is clouded by new trade policies that could impact business confidence and growth. While this has caused many investors to adopt a "fearful" wait-and-see approach, we're leaning into our best ideas that can grow regardless of the political or macroeconomic climate. Take advantage of Mr. Market by checking out our Top 5 Strong Momentum Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025). Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+782% five-year return). Find your next big winner with StockStory today. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
29-06-2025
- Business
- Yahoo
Centrelink's ATO July 1 warning for recipients about to lodge tax returns: 'Reduce the risks'
It's that time of year again, when everyone scrambles to find their receipts and figure out what they might be able to claim back on tax. Now let's be honest, despite telling ourselves this time last year that we'll be extremely organised and record donations and work-related expenses throughout the year, most of us have not. To help simplify tax time queries Services Australia has put together a guide for customers who get a payment or service from them. What you need to do during tax time depends on your circumstances, but most families who get Family Tax Benefit (FTB) or Child Support Subsidy (CCS) need to do something before we can balance their payments. Centrelink $836 cash boost for 'very real' truth facing thousands of Aussies Woolworths payment change as popular system gets axed More superannuation changes flagged as Baby Boomers get anxious Between July and October every year, you and your partner (if you have one) may need to lodge a tax return. The easiest way to check if you need to lodge is using the Australian Taxation Office's (ATO) website. If you do need to lodge, and you get payments from Services Australia or other income from employment, most of these details should pre-fill in ATO myTax through myGov by late July. Hot tip - don't rush to get your tax done. Save yourself time, reduce the risk of mistakes, and lodge when your details pre-fill in late July. The alternative is finding and plugging all this info in yourself and making sure your calculations are you get certain payments from us, you can check your Centrelink payment summary to see most of the taxable and non-taxable payments you got in the financial year. Most of these should pre-fill in your tax return by mid-July. If you need a copy, you can access your payment summary from early July in your Centrelink online account through myGov or the Express Plus Centrelink mobile app. It'll show amounts that are tax exempt and tax withheld amounts that show as deductions. Some payments don't show on the payment summary and won't pre-fill in ATO myTax. You might need to add them to your tax return yourself. This includes disaster payments. If you're not eligible for Medicare for all or part of the financial year and want to claim the Medicare levy exemption, you can ask us for a Medicare Entitlement Statement (MES) from July 1. You need a MES to apply for the Medicare levy exemption in your tax return. The ATO will then decide if you need to pay the Medicare levy. If you get Family Tax Benefit (FTB) or Child Care Subsidy (CCS), at the end of each financial year we'll compare your income estimate with your actual income. This is how we check you got the right amount during the year. This is called balancing. We do this from July for FTB and from mid-August for CCS. In most cases, we'll balance your payments after you lodge your tax return. If you have a partner, they'll need to do this as well. If you or your partner don't need to lodge, you can confirm your income by telling us that you're not required to lodge, using your Centrelink online account through myGov or the Centrelink mobile app. As if tax time isn't busy enough, people need to be on high alert as scams can be rife in the lead up to tax time. Beware of emails, phone calls, texts and social media messages claiming to be from us, the ATO, myGov or another government department. Scammers often make fake websites that mimic myGov to steal personal and financial information. If they get a hold of this information, they might be able to use your identity to steal your payments, commit fraud and other crimes. Remember, myGov messages will never ask you to: Click a link to sign in Enter your bank details Provide identity documents like a driver's licence or passport Share your personal information or myGov sign in details A good rule to follow – Stop. Check. Protect. If in doubt, don't respond and definitely don't click that link. You can safely access your myGov account and linked services, use the official myGov app or sign in at in retrieving data Sign in to access your portfolio Error in retrieving data
