With another financial year behind us, it’s time for you to start thinking about lodging your Income Tax Return (ITR) for 2022. There have been numerous changes relating to what you can deduct in your ITR, and it’s important you understand these changes and note what you may be entitled to claim in your return.

What changes do I need to be aware of when lodging my Income Tax Return?

1. Low and Middle Income Tax Offset (LMITO)

The LMITO will continue to be available in the 2022 financial year, however it has been increased by a one off payment of $420.

The offset is available to taxpayers with a taxable income between $37,001 and $126,000. Taxpayers will receive a benefit depending on their level of income ranging from $675 to $1,500.

2. New Tax Deductions for Covid-19 Tests

You can claim a deduction for the cost of a Covid-19 test as of 1 July 2021. The tests are only tax deductible when the purpose of the test is to determine whether the individual can attend or remain at a place of work or business.

If you use a Covid-19 test for private purposes eg in relation to a leisure activity, private travel, to test children, or for the prospect of future employment then the expenditure is not deductible.

If an Employer has reimbursed the cost of the Covid-19 test then it is not deductible.

3. Home to Work Travel

A new ATO travel concession allows more employees to claim home to work travel. Usually, travel from home to the workplace is not deductible. This has now changed when ‘home’ has become your primary place of work. If you are working from home and travel to a workplace to continue your work for the same employer, you can claim the cost of this travel.

4. Working From Home

The ATO has extended the temporary shortcut method of $0.80 per hour for calculating deductions relating to the costs incurred as part of employees working from home due to Covid-19 restrictions.

This shortcut method is an all-inclusive rate available for employees who worked from home during the 2022 financial year. Other methods, including the fixed rate and the actual expense methods, also remain available for employees to claim a deduction for expenses related to working from home.

How Davidsons can help you with your 2022 tax return

Book an appointment with our tax return specialists

Our team of personal income tax return specialists are here to support you, either virtually or at our Geelong or Torquay offices.  

Contact our team by completing an enquiry form, calling us on 03 5221 6399 or emailing via info@davidsons.com.au

Download our income tax return checklist  

Use our checklist to ensure you include all the required information for your 2024 tax return and make the most of any available tax benefits.  

Download our income tax return checklist for individuals 

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Disclaimer: The information provided in this article is factual in nature and objectively ascertainable and, therefore, does not constitute financial product advice. Importantly, the factual information that has been supplied does not take into account your personal circumstances, objectives or goals.