For businesses and individuals around Newcastle, getting your tax return right goes beyond dotting the i’s and crossing the t’s. It’s about making sure your numbers truly reflect your financial year. The most common tax slip-ups can often be avoided with simple checks and clearer record-keeping. Let’s go through the errors that catch people out the most and how you can steer clear of them.
Tax time isn’t most people’s idea of fun, and it’s easy to see why. Filling in forms, digging through old receipts, and trying to remember if that one-off payment counts as income or not can become a stressful guessing game. But even small mistakes on your tax return can have a surprising impact. You might miss out on money you’re entitled to, or worse, end up with penalties or delays that cause unnecessary headaches.
Misreporting Income
One of the easiest ways to land yourself in trouble with a tax return is by not reporting all your income correctly. This might not be intentional. Some sources are just easy to forget. You might be focused on your main job or business but overlook smaller payments, side gigs, bank interest, or even cash work from the year. Leaving any of these out can make your return incomplete, which can lead to questions or penalties later on. Reports from your employer, clients, or banks are often sent straight to the ATO, so mismatches are easy to spot.
Underreporting isn’t the only issue. Overreporting can also hurt. This happens when the same income is accidentally recorded more than once, or when business income is counted together with personal funds that shouldn’t be included. Mistakes like this can raise your taxable income higher than it actually is, meaning you might pay more than you owe.
Here are a few things to keep in mind to report your income clearly:
1. Track income from all sources, not just your main job or business
2. Keep records of freelance or contract jobs, even the one-off gigs
3. Download and double-check your payment summaries and income statements
4. Check that bank interest and dividends are included, even if they seem minor
5. If you received support payments or grants, confirm whether they count as income
Taking time to list everything clearly from the beginning can save you heaps of time and money down the track. A little attention here goes a long way.
Failing To Keep Proper Records
Good records are the foundation of an accurate tax return. Still, many people get tripped up by missing receipts, inconsistent logs, or messy spreadsheets come tax season. The result is guesswork, incorrect entries, and potential trouble if the ATO asks for supporting documentation.
Bookkeeping isn’t just about staying organised. It’s about backing up your claims. If you want to claim deductions for work-related costs, for example, you’ll need proof. If you want to report business income accurately, those invoices and bank statements are your starting point. The longer you wait to organise your records, the harder it becomes to pull things together properly.
Sometimes people think that digital records aren’t necessary if they have the numbers written or saved elsewhere. But storing one-off receipts in email folders or trying to reconstruct everything from memory rarely ends well. Even businesses with accounting software should occasionally spot-check that entries are complete and categories are correct.
To avoid running into problems, try these habits:
1. Keep all receipts and invoices in one place—physical or digital
2. Update logs weekly or monthly instead of cramming it all in at the end
3. Use clear labels when storing documents or uploading to cloud systems
4. Make backups so that everything isn’t riding on one phone or computer
Well-kept records make tax time less stressful and prepare you for everything from grant applications to business forecasting. Think of it as setting yourself up for a smoother year ahead.
Not Claiming All Eligible Deductions
When tax time rolls around in Newcastle, overlooking deductions is a mistake that can leave money on the table. People often skip claiming certain expenses just because they’re unsure if they qualify. But deductions are there to help lower your taxable income, and missing them means you’re likely paying more tax than you need to.
Common expenses that fly under the radar include home office costs, travel between worksites, and equipment purchases related to business activities. Even phone and internet use can be partially deductible if you’ve been using your devices for work. Some people assume an expense needs to be big to matter, but small ongoing costs can add up if they occur regularly throughout the year.
One example we come across every now and then is with self-employed people using their personal car for work purposes but not logging the kilometres. Without a record, it becomes harder to justify the claim. Even though the expense is real, it becomes a lost opportunity without proof.
To make sure you don’t miss your entitlements:
1. Keep receipts and track expenses all year, not just at tax time
2. Separate personal and business purchases where possible
3. Use a logbook or tracking app if you’re claiming travel or vehicle-related expenses
4. Revisit past expenses that you might have assumed weren’t deductible
5. Check whether any tools or subscriptions used for work can be claimed
Doing a bit of prep mid-year can help take the pressure off later. Knowing what you’re entitled to claim can make a clear difference once everything’s submitted.
Errors In Reporting Business Expenses
One of the more confusing areas on a tax return is the section about business expenses. It’s not always straightforward trying to figure out what counts as business and what’s personal. Blurring the lines here can lead to incorrect claims or poor reporting, which both raise red flags.
For example, occasionally grabbing a coffee while meeting a client at a cafe doesn’t mean every takeaway coffee of the year is tax deductible. Similarly, buying a computer used 80 percent of the time for work and 20 percent for personal use needs to be reported in that proportion. Unless expenses are recorded accurately, you could end up overstating your costs or underestimating your taxable income.
One area where mistakes often pop up is when people mix their personal and business bank accounts. That might feel simple at first, but without a clear divide, you’ll spend heaps of time down the track sorting through transactions and second-guessing their purpose.
Stick with these habits to keep your business expenses clean and easy to report:
1. Use dedicated bank accounts and cards for business spending
2. Make a note on each receipt or invoice about what it was for
3. Save every invoice, even for digital subscriptions or renewal fees
4. Don’t include personal expenses in your business return, even if they feel work-related
5. Revisit your reports every few months to catch errors before tax time
Taking a little extra care here can help make your tax prep faster and far less stressful. Mistakes in this section are common but very preventable.
TSP Can Help Get It Right The First Time
Dealing with a tax return shouldn’t feel like guesswork. Whether you’re running a small business or working for yourself, staying on top of your records and understanding where the common traps are can make a real difference. Mistakes like overlooking income, losing receipts, or claiming the wrong expenses often come from lack of clarity rather than effort.
That’s why getting help from the start is often the smarter choice, especially when it comes to tax returns in Newcastle. Having someone walk you through the process and look over your records can help avoid costly surprises later. With the right support, you can approach tax time with more confidence and less stress.
Looking to make tax time a whole lot easier? Whether you’re a sole trader or run a small business, TSP Accountants is here to help with tax returns in Newcastle. With us handling the paperwork, you can avoid common errors and feel confident that everything is submitted correctly the first time.