Almost one in two Aussies are expecting a much-needed tax refund this year as cost of living pressures make the cash critical for many everyday Aussies.
A survey from Finder found more than 9 million Aussies will see a very welcome cash injection from the Australian Taxation Office after the end of the 2023-24 financial year.
The average recipient will see $1288 coming back into their pocket, with a total of $12 billion going to taxpayers.
Of those getting a refund, 1-in-10 said the cash was critical for their financial wellbeing while one in four of those surveyed said the refund was very important.
Another 43 per cent said the money was important, making the money a priority for more than three quarters of those receiving a tax return.
The funds are so critical to everyday Aussies as they look for ways to handle financial pressures, according to personal finance expert at Finder Sarah Megginson.
“As many households grapple with the cost of living, millions are hoping for a cash injection to soothe their financial woes,” Ms Megginson said.
“It’s possible there will be an influx of early lodgements with so many reliant on a funding boost.”
More women reported needing the cash back than their male counterparts with 42 per cent of female respondents saying the money was very important or critical for their financial health compared to 28 per cent of men.
Despite more women needing the cash, they are in store for a lower return than men with an average of $1237 coming back for women while $1344 was coming to the average male’s tax return.
To capitalise on this tax return, Ms Megginson encouraged Aussies to claim all eligible deductions and back this up with sound financial evidence.
“Evidence is really important, so hang on to all of your receipts, invoices and bank statements to support your claims,” she said.
Echoing the personal finance expert’s point was CPA Australia spokesperson Gavan Ord who shared his five do’s and don’ts of tax time.
Mr Ord similarly called on Aussies to be as thorough as possible, while urging taxpayers to purchase work-related items before June 30, seek professional tax help and take their time filing taxes.
“It’s possible that cost-of-living pressures mean people are more eager than usual to lodge their tax return and access a refund,” he said.
“We know it’s tempting to lodge your return straight away, but you should wait for the ATO to finish pre-filling your tax information. This can take several weeks or more.
“Many who lodge in early July end up having to amend their returns later so it’s best to wait. It’ll save you in the long run.”
The need for tax back comes as interest rates were held at 4.35 per cent for the fifth month in a row on Tuesday.
In its decision on Tuesday, the Reserve Bank said inflation remained above target, but has “fallen substantially” since its peak two years ago in 2022.
The RBA said returning inflation to its two to three per cent target range within a “reasonable timeframe remains the board’s highest priority”.
“The economic outlook remains uncertain and recent data have demonstrated that the process of returning inflation to target is unlikely to be smooth,” a statement read.