If you are aged 60 years and above and have a taxable income, whether it is from investments or employment, you will need to lodge a tax return by 30th June each year.
Tax returns for Age Pension recipients
If you receive the Age Pension (either full or part) and received income from other sources and Centrelink is withholding tax from your pension payments, it is compulsory to lodge a tax return each year.
If you're 60 and over, the income will generally be tax-free. If you're between your preservation age and 59, the components of your super will dictate how it will be taxed.
To be eligible for an Australian Government age pension from Centrelink, you must be 66 years and 6 months or older on 30 June 2021. This is 67 years or older from 1 July 2023.
6 Years for Filing Back Taxes, 3 Years To Claim a Refund
The IRS will eventually intercede and file a substitute tax return for you if you wait too long and if you had any income during the year in question, and this probably would not be in your best interest.
You have to bring your bank statements, receipts and any sort of documents that reveals your financial information and with your consent. We can lodge all your previous years tax returns be it 2 years or 10 years.
20 March 2023 the full pension is available, under the assets test, for homeowner singles whose assessable assets are under $280,000 – for homeowner couples the number is $419,000. The numbers for non-homeowners are $504,500 and $643,500 respectively.
If you are retired and already drawing your pension income from your super accounts, CGT is not applicable. All investment earnings in pension phase are tax exempt to a limit of $1.6million.
It's a common myth that there is an age limit to CGT in Australia, or that retirees are exempt from Capital Gains Tax. Unfortunately, much like everyone else, retirees are required to pay Capital Gains Tax, which can dramatically add to their yearly taxable income.
If you get a taxable Centrelink payment, you may need to lodge a tax return at the end of the tax year. You'll get a Centrelink payment summary if you get any of these taxable Centrelink payments: ABSTUDY Living Allowance, if you're 16 or older. Age Pension.
Taxable income is your gross income, less any allowable deductions. When you update your income estimate you need to include all the income you and/or your partner expect to receive for the full financial year including: salary and wages. lump sum payments.
Whether the money in your super account is tax-free or taxable when you withdraw it generally depends on the type of contributions made and whether tax was paid on it. Non-concessional (after-tax) contributions – those made from income after you paid tax on it – are tax-free when withdrawn from your super account.
On 1 December 2022, a one-off $4,000 income credit was added to the Work Bonus income bank of those at least pension age and in receipt of an Age Pension, Disability Support Pension, Carer Payment or certain Veterans entitlement. Prior to 1 December 2022, the Work Bonus income bank was capped at $7,800.
The payment rates for Age Pension, Carer Payment and Disability Support Pension are increasing from 20 March 2023. Age Pension, Carer Payment and Disability Support Pension will increase by $37.50 a fortnight for singles and $56.40 a fortnight for couples combined.
The government will provide $3.7 million in 2023–24 to extend the measure to provide age and veteran pensioners a once-off credit of $4,000 to their Work Bonus income bank and temporarily increase the maximum income bank until 31 December 2023.
In some cases, you may not have to pay the levy at all. In 2021–22, you do not have to pay the Medicare levy if your taxable income is equal to or less than $23,365 ($36,925 for seniors and pensioners entitled to the seniors and pensioners tax offset (SAPTO)).
Who Doesn't Pay the levy? Those who earn equal to or less than $23,365 do not need to pay the Medicare levy in the 2021-22 financial year. The cut-off is $36,925 for seniors and pensioners who are entitled to the seniors and pensioners tax offset (SAPTO).
Take out private hospital cover. It's that simple. You enter you private hostpial cover details on your tax return, and then the ATO will not apply the medicare levy surcharge to you. Important Note: You must have private hospital cover to avoid the surcharge.
If you use a part of your principal home for business only, that will be included in your assets test - land or buildings. Centrelink advises you need to contact them within 14 days of selling the home.
You can be fined
You may also have to pay interest on any amount you owe. It is best to lodge on time even if you can't pay the amount you owe. You can usually arrange a payment plan. A late payment is better than a late lodgment.