Do I need to lodge an individual tax return ?

Author: Duncan Warnock CPA | February, 2015

Although most people do need to lodge a tax return each year, there are some situations where an individual tax return does not need to be lodged.

The Australian Taxation Office have a quick ready reckoner to help you work out if you need to lodge an income tax return for a particular year. Follow this ATO link https://www.ato.gov.au/calculators-and-tools/do-i-need-to-lodge-a-tax-return/

Examples situations where you will need to lodge a tax return for the 2014 tax year include:

Your taxable income was more than $20,542 during the income year 2013-14

You made any tax instalment payment under the PAYG (Pay As You Go) during the income year 2013-14

You had tax withheld from any Australian income you earned during the income year 2013-14?

You carried on a business during the income year 2013-14

You received income from dividends or distributions exceeding $18,200 (or $416 if you were under 18 years of age at 30 June 2014) and you were entitled to a franking credit (from a dividend or trust distribution)

You made a loss or can offset a loss that you made in a previous year against income

You were entitled to a distribution from a trust or a partnership that carried on a primary production business

You qualified as a special professional (sportsperson, artist, inventor) covered by the income average rules

Trap for young players ! A common mistake taxpayers make is to think that if their income is low then a tax return does not need to be lodged. Although this can often be true, if any tax has been withheld during the financial year then then an income tax return needs to be lodged. Tax withheld is usually in the form of tax withheld by an employer from wages and salary payments. Tax is also withheld from bank interest payable on funds in a bank account where the taxpayer has not provided their tax file number to the financial  institution.

If you dont need to lodge an income tax return, its usually a good idea to advise the tax office by way of a 'non-lodgment advice' . You can download a PDF version from the ATO website or alternately seek some assistance and guidance from your accountant.

REMEMBER : If you need to lodge a tax return but don't lodge it, you may have to pay a penalty.