The Australian Tax Office has received a huge surge in tax lodgements over last year – and Australians are being showered in tax refunds.
There continues to be a dramatic surge in people lodging their tax returns quickly this year as Australians scramble to take advantage of the government’s tax cuts.
The Australian Taxation Office has already received more than 2.9 million lodgements — an increase of 460,000 over this time last year — even though the deadline for individuals to submit their returns is not until the end of October.
And those who got in early are benefiting. The ATO has processed more than 1.3 million tax refunds so far, returning a total of $3.1 billion to Australians. The average refund is $2381.
Why are people suddenly so eager to do their taxes? The answer is simple.
At the start of this month, the government passed its three-stage, $158 billion income tax package through parliament, delivering on the central plank of its re-election campaign.
Stage one of that package promised up to $1080 in immediate relief for low and middle income earners. Australians will receive the extra money in their next three tax returns, including this year’s.
About 4.5 million workers will receive the full, glorious four-figure sum, and in total, more than 10 million will score some level of tax offset.
The government’s tax plan was a source of controversy during the election campaign, as Labor argued it was too generous towards high income earners.
But new Opposition Leader Anthony Albanese eventually relented and helped pass the legislation in full when parliament met in early July.
Phase two of the package is aimed at fighting “bracket creep”. It will raise the top limit of the 19 per cent tax bracket from $41,000 to $45,000 from 2022/23, while the low income offset will also be increased from $645 to $700.
Stage three involves dropping the 32.5 per cent tax rate to 30 per cent from July 1, 2024 — meaning all workers earning between $45,000 and $200,000 will be on the 30 per cent rate.
If you haven’t got around to submitting your own tax return yet, don’t worry. Individual returns do not need to be lodged until October 31.
You can submit yours via the online portal.
But there is no need to rush. In fact, the ATO has previously urged Australians to “wait a few weeks” to make the process easier and ensure they don’t miss out on a bigger refund.
“That provides more time for employment income and other information like bank interest and private health insurance details to be pre-filled too, making lodging easier.”
“Taxpayers can lodge earlier but we know from previous years that the early birds who lodge in the first weeks of July are far more likely to make mistakes or submit incomplete data.”
In short, the longer you wait, the more information will be automatically filled in for you, and the less work you will need to do yourself.