Friday 13 November 2020

Lodged an amendment to DS2's tax return

A few months ago I submitted DS2's tax returns for the past several years (as the dividends from his share investments and interest on his bank savings slowly grew his income tax liability has slowly grown and now exceeds the franking credit refund). I initially hadn't bothered including his 'earned income' from busking, but then realized that without any earned income he wouldn't get the government co-contributions for the $1,000 undeducted contributions he made into his superannuation account in FY 2018 and FY2019. I did the amendment for his 2019 tax return and the result was a small reduction in the amount of income tax he earned (from around $35 to under $30 - I'm not sure why having more income reduced his tax liability - probably something to do with the low or middle income tax offsets?) and also resulted in the $500 government co-contribution for that FY turning up in his super account a few weeks later. When I get some spare time I'll do an amendment for the other year where he earned some money busking and made a contribution into his superannuation, which should result in another $500 co-contribution from the ATO into his super account. Every little bit helps, especially when it will have half a century to compound in a low tax environment before he reaches retirement/preservation age.

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