Streamlining Tax Preparation in Australia: Take an Organized Approach with PDFs

Being organized when you lodge your annual tax return is important. Whether you prepare and submit your tax return directly to the Australian Tax Office or use a tax agent, it makes the tax preparation process a lot easier if you’ve systemically kept the records you need.

Using a digital system for your tax documents and record keeping can mean that when the annual tax return date in Australia of October 31 rolls around each year, you’ll have everything you need already organized and in order in digital files ready to go.

What you’ll learn

• Going digital with tax documents
• Creating a document checklist for a tax return
• Managing multiple documents - rearranging and merging, and more
• Naming, saving and storing tax records

Go digital with tax records.

You can easily organize tax documents by turning them into PDF files — if they’re not in PDF format already. Why? The Portable Document Format (PDF) is a safe and reliable way to save, store and send digital documents.

PDFs are paperless and save physical storage space for paper documents.

Not only does the Australian tax office allow for the digitization of tax records, but they also recommend digital record keeping. Just be sure to follow the ATO’s “five rules for record-keeping” to ensure digital documents. That is, they cover your tax obligations, are true and unaltered copies of the originals, are retained for the appropriate length of time and are stored securely and appropriately and are in English.

PDFs can be converted to and from different document formats.

Scanning tax documents to PDF, printing to PDF from within different apps and software, and even converting to PDF online to and from a range of file formats, are all ways to put those tax records into electronic PDF files.

PDFs are easy to store, send and upload as proof of income and expenses.

PDFs are easy to upload when you lodge a tax return online with myTax in Australia. PDFS are also easy to organize and store on your own local system, device, or in the cloud, and/or send to others involved in your tax return.

PDFs are secure and easy to view.

PDF files can also be opened and viewed by you and anyone helping you with your taxes on any operating system with a PDF Reader - Windows and Mac computers, iPhone and Android phones, you name it. You have control in security settings to add passwords to prevent authorized changes.

Create a checklist of tax return documents you need.

Create a checklist ahead of time of what you need to keep track of for tax purposes, and then organize your documents by these categories. Generally, the types of documents needed for tax returns show proof of your income and any expenses that can be claimed as deductions. The documents you will need for your tax return will depend on your situation. This includes whether you are filing as an individual, self-employed sole trader, partnership, or business.

Some of the general types of documents you may need to file a tax return and put into PDFs for tax filing include —

• Your bank account details (should you be entitled to a tax refund)

Income

• Payment summaries from your employer(s) or for your business or individual services income
• Annual bank statements summarizing interest earned on bank accounts
• Annual statements showing income from investments, dividends, shares, etc.
• Investment property income
• Foreign income earned.

Deductions

• Receipts from donations to charities
• Receipts for work-related expenses incurred such as travel, vehicle use, education, tools, equipment and uniforms.
• Details of insurance such as health, income protection, sickness, and accident
• Investment property expenses such as rates, insurance, depreciation, repairs and maintenance.
• Invoices from accountants or tax agents for tax return preparation

For your specific circumstances, more information can be found on the Australia Tax Office website or from your accountant or tax agent.

Manage multiple tax documents —rearrange, merge, and more.

Often after digitizing tax documents to PDF, you will have several individual files that might make sense to combine into one. For example, one file for all copies of Pay as You Go (PAYG) statements. Or you have digitized documents that include other attachments that aren’t needed for tax purposes.

While you can’t alter the actual details of tax documents and records, you can reorganize them, so they are logical and only include what you need. Some ways to keep your tax records organized within PDFs online or within one of the Adobe Acrobat products include features such as:

• Merging PDFs — combining PDF tax can make a lot of sense and it’s easy to do. Merging multiple files into one makes them easier to organize, store, send, and review. And yes, you can also split a PDF too!

• Rearranging PDFs — got a page or two out of the order you want them or need to switch from portrait to landscape? Move pages around, rotate, and as needed so your PDF pages are in a logical flow and order.

• Add PDF pages and/or delete pages— found another document that you add or scanned something you didn’t need? Just add or delete PDF pages so you’re only keeping relevant information.

• Compress PDFs — no one likes sending, receiving and uploading huge files that seem to take forever. Similarly, even though digital file storage saves on physical storage space, it’s still good practice to keep digital file sizes down as much as possible on any device or electronic storage system.

Name, save and store tax records logically and securely.

Manage PDF tax files logically and securely.

Use logical and best practice naming conventions for saving electronic PDF tax records so that it is easy for you to see, search and sort both individual files and folders. This might be by using a consistent format such as the date starting by year, and a description of contents. For example, “2022-23 Charity Donations”.

One good way to organize tax documents in folders is to create a top-level folder for each tax year. Then create sub-folders for different categories. For example, a top-level folder for all 2022-2023 tax documents, and further sub-folders for income, expenses, and other tax records.

Always store your digital tax records securely. Tax records and documents often contain sensitive and personal information that is important to protect. Keep up to date with your system updates and security patches, and if using cloud-based storage use reputable and secure systems.

Tax time made easier.

Getting everything together and ready to prepare and lodge your annual tax return doesn’t need to be tough. Once you’ve developed a system to collate everything you need and digitized your documents in PDFs, it’s a simple and easy process to either log in to the Tax Office online portal and work through the tax return process directly with the information at your fingertips or send your PDF files to your account or tax agent for them to take care of it for you.