Tax Time Made Simpler

Your PAYG income statement (or payment summary) is the single most important document you'll use when lodging your annual tax return. Getting it right — and understanding how to use it properly — can make the difference between a smooth lodgement and an ATO review. Here are five practical tips every Australian should know.

Tip 1: Wait Until Your Income Statement Is Marked "Tax Ready"

One of the most common mistakes Australians make is lodging their tax return too early. If your employer uses Single Touch Payroll, your income statement in myGov needs to show "Tax ready" status before you use it. This typically happens after your employer submits their finalisation declaration — which they have until 14 July to complete.

If you lodge before your statement is finalised, the ATO may process your return with incorrect figures, potentially causing delays or an amendment down the track. Be patient — a few extra days is worth avoiding the hassle.

Tip 2: Account for All Sources of Income

If you worked for more than one employer during the financial year, you'll have multiple income statements. The ATO pre-fills many of these into myTax automatically, but it's your responsibility to verify them. Check that:

  • All employers are listed
  • Gross income figures match your own records
  • Tax withheld amounts appear correct

Don't forget other income sources — interest from savings accounts, investment dividends, rental income, or freelance work — these must also be declared even though they won't appear on your PAYG statement.

Tip 3: Understand Reportable Amounts Before Claiming Benefits

Your income statement may include a Reportable Fringe Benefits Amount (RFBA) and/or Reportable Employer Super Contributions (RESC). These figures are not added to your taxable income for basic tax purposes, but they are included in your adjusted taxable income (ATI).

Your ATI is used to determine eligibility for:

  • Family Tax Benefit (FTB)
  • Child Care Subsidy
  • Medicare Levy Surcharge thresholds
  • Various tax offsets (including the Low Income Tax Offset)

If your ATI is near a threshold for any of these entitlements, understanding your RFBA and RESC figures can have a real financial impact.

Tip 4: Match Your Deductions to Your Income Type

Your PAYG statement tells the ATO (and you) what type of work income you earned. This is directly relevant to the work-related deductions you can claim. The ATO expects deductions to be logically connected to the income you earned. For example:

  • A nurse can claim uniform and scrubs laundering costs
  • A tradesperson can claim tools and protective clothing
  • Someone working from home can claim home office expenses under ATO-approved methods

You must have records to substantiate claims over $300 in total work-related deductions. Keep receipts, logbooks, and diary entries throughout the year — don't try to reconstruct them at tax time.

Tip 5: Use the ATO's Pre-Fill Service — But Don't Rely on It Blindly

If you lodge via myTax (the ATO's online lodgement tool), income and withholding figures from your employer are often pre-filled automatically. This is a helpful time-saver, but it's not infallible. Always compare pre-filled data against your own records, because:

  • Pre-fill data may not be available until after 14 July
  • Employers occasionally submit corrections after finalisation
  • Some payments (like one-off bonuses paid late in the year) may not have been captured yet

Treat pre-fill as a starting point, not a guarantee of accuracy.

A Note on Tax Agents

If your tax situation is complex — multiple employers, investment income, rental properties, or self-employment alongside a salary — it may be worth engaging a registered tax agent. Tax agents have until 31 October (or later under their lodgement program) to lodge returns on your behalf, giving you more time to gather documents and get your affairs in order.