Australians plan to save their tax returns this year despite not knowing nor actively planning to maximise what they receive, according to TaxTank.
New research from cloud-based tax software TaxTank reveals over half (56%) of Australians find tax time stressful, with the notion of missed deductions causing the greatest degree of anxiety.
Despite this, more than half (54%) of those surveyed said they did not feel confident they were claiming all of their deductions, with one in five (19%) stating they were certain they were missing out, revealing a concerning misalignment between what Australians taxpayers want, and what they are doing to get it.
Commenting on the research, TaxTank founder Nicole Kelly, said “It’s not uncommon for taxpayers to feel stressed at tax time – it’s often a mad rush to consolidate expenses for a looming deadline where you have no idea what the outcome might be, especially if you’re planning to self-lodge. You’re also having to spend countless hours trawling through transactions and searching for receipts and knowing you’re missing things – nobody wants that.
“It might sound counterintuitive at first, but taking just a few minutes every week to proactively manage your expenses and possible deductions can actually save you a lot of time, not to mention reducing stress and greatly improving the outcome of your return.”
The time Australian taxpayers spend managing their taxes correlates with the stress and confidence levels reported, with half (49%) spending less than four hours annually managing their taxes. A variety of methods for managing taxes was revealed with keeping receipts and documents in a folder (31%) the most popular. One in ten (10%) reported their system as a mess with stuff everywhere.
The research coincides with the recently announced boost to the low and middle income tax offset (LMITO) in the Federal Government budget which will, according to the research, see over one third (36%) of Australians lodge their tax return as soon as possible to pocket any extra savings. Surprisingly, one in four (24%) of respondents were not aware of the offset increase.
Additionally, after missing deductions at tax time, taxpayers are most worried about not knowing if they will receive a refund or bill from the Australian Tax Office (ATO) and making a mistake during the tax return process.
Given the perceived confusion and ambiguity surrounding the overall tax return process, it is unsurprising the findings also show one in ten (10%) respondents feel the tax return process is unfair due to its complexity. Further, more than one in four (28%) think they pay too much tax, while another one in four (25%) feel they are getting ripped off. When it came to the ATO itself, the survey revealed that two in five (42%) Australians have a distrust for it.
“There’s clearly varying elements of confusion, ambiguity and distrust when it comes to paying tax, and our view is that most of these issues can be alleviated with increased transparency and planning. Having the visibility and ability to actively manage your tax position 24/7 gives Australians the certainty they want to see and feel, when it comes to managing their tax,” Nicole added.
About the survey
The survey was commissioned by TaxTank and undertaken by Pureprofile to analyse habits of individual Australian taxpayers ahead of the 2022 tax season. Their attitudes towards managing their taxes, sentiment towards the Australian tax system and spending intentions was also analysed. From 29 April – 4 May 2022, Pureprofile conducted an online quantitative survey, interviewing 1000 Australian taxpayers. The survey is nationally representative.