Individuals: Tax Time FAQ’s – General Tax Return

1. How do you claim medical expenses?

You can claim the net medical expenses you have paid less any refunds you got, or could get, from Medicare or a private health insurer.

You can claim a tax offset of 20% – 20 cents in the dollar – of your net medical expenses over $1,500. There is no upper limit on the amount you can claim. Refer to Net medical expenses tax offset for more information on the net medical expense offset.


2. Your employer has been withholding extra amounts of tax from your pay – why hasn’t the balance of your Higher Education Loan Programme (HELP) account been reduced?

Your employer will withhold additional amounts from your pay throughout the year to cover your anticipated compulsory HELP repayment.

These amounts withheld are not credited to your HELP account during the income year but will be included in the PAYG withholding credits label on your notice of assessment. Your final tax liability and compulsory HELP repayment are calculated at the end of the income year after you submit your income tax return.

At that time, any amount your employer has deducted from your pay will be used to offset the compulsory HELP repayment has been calculated. Any extra amounts that you may have overpaid will be refunded to you at that time. Similarly, if you have not paid enough tax through employer deductions, you may receive a bill. The compulsory repayment shown on your notice of assessment is credited to your HELP account on the date the notice of assessment is issued.

For more information, see Repaying your HELP debt


3. If you have incurred out-of-pocket child care expenses throughout 2009, how will you claim your Child Care Tax Rebate in 2009?

Since 1 July 2007, the Child Care Tax Rebate has not been paid through the tax system. It is now made as a direct payment to families from the Family Assistance Office at the end of the financial year in which the child care costs were paid.

For more information on the Child Care Tax Rebate, including eligibility, visit the Family Assistance Office website at http://www.familyassist.gov.au/



4. What is the cents per kilometre method?

The cents per kilometre method is one of four methods set out in the law for calculating deductions for car expenses. It gives taxpayers a simple means to calculate their deduction.
You can use this method to claim up to a maximum of 5,000 business kilometres per car even if you have travelled more than 5,000 business kilometres. For example, if you travelled 5,085 business kilometres, you can only claim the cost of travelling 5,000 kilometres with this method. You cannot claim for the extra 85 kilometres.

You don't need written evidence but you may need to be able to show how you worked out your business kilometres.

The cents per kilometre rate is determined each year by the Department of Education, Employment and Workplace Relations (DEEWR) based on movements in the consumer price index (CPI) for private motoring. The new rates are generally published in June to allow taxpayers to make an informed decision about whether they wish to use the cents per kilometre method or one of the other methods set out in the law to calculate their deductions for car expenses.

The other methods taxpayers can use to calculate their deductions for car expenses are 12% of original value , one-third of actual expenses, and logbook.