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New push tax returns

The ATO has recently revealed that over a million Australians may be able to avoid filling in a tax return in 2014.

As many as 1.4 million Australians could be offered new ‘push’ returns from as early as next year. Lodging a tax return will still be necessary; however the process of filling the tax return in will be simplified.

This planned product, known as Streamlined Income Tax Return, will be available to Australians who have simple and straightforward tax affairs.

The ATO already collects the majority of information that is required to fill and lodge a tax return and plans to use this information to pre-fill a taxpayer’s tax return.

Streamlined Income Tax Return will allow taxpayers to log straight onto the ATO’s system. They will only need to prove their identity to be able to view a completely pre-filled tax return. This tax return will already have all the relevant information provided by third parties, such as banks, employers, Centrelink or Medicare.

This pre-filled return will also list estimates of items such as work-related deductions. This estimate will be calculated by rolling over information used in past tax returns.

However, it is important to note if taxpayers lodge an incorrect pre-filled return with the ATO they will be liable for the mistake and could incur a fine. Streamlined Income Tax Returns will only be suitable for those taxpayers with simple tax affairs. Taxpayers will still benefit from the services of a trusted tax agent who understand their individual circumstances.

Posted on 23 January '14 by , under Tax.

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Transition to retirement

The transition to retirement (TTR) strategy allows you to access some of your super while you continue to work.

You are able to use the TTR strategy if you are aged 55 to 60. You can use it to supplement your income if you reduce your work hours or boost your super and save on tax while you keep working full time.

  • Starting a TTR pension: To start your TTR pension, transfer some of your super to an account-based pension. You have to keep some money in your super account so that you can continue to receive your employer's compulsory contributions as well as any voluntary contributions you may be making.
  • Government benefits and TTR: The benefits you or your partner receive might be impacted if you choose to opt for this strategy. How and what exactly will change might become clearer upon discussing this with a Financial Information Service (FIS) officer.
  • Life insurance and TTR: In some cases, the life insurance cover you have with your super may stop or reduce if you start a TTR pension – check this before making any decisions or changes.

TTR can help ease your mind as you transition into retirement but it can be a bit complex. Before you choose whether you want to use TTR to reduce work hours or save on tax, or even if you want to use TTR altogether, you should figure out how this will impact all aspects of your finances.

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