Tax season 2025: Essential Do’s and Don’ts to get our return right

Introduction

As tax time rolls around, many Australians find themselves overwhelmed by the pressure to get everything right—gathering receipts, understanding deductions, meeting lodgement deadlines, and staying compliant with the Australian Taxation Office (ATO). Each year, a surprising number of tax returns are delayed, audited, or penalised due to avoidable mistakes and misinterpretations of the rules.

To help you navigate tax season 2025 smoothly, this article outlines the most important dos and don’ts when preparing and lodging your tax return. These tips are based on ATO guidance, industry updates, and common pitfalls observed by tax professionals across Australia.

Lodgement dates for the 2025 tax return

Before we get into the do’s and don’ts for this tax season, it is important to understand the lodgement timeline. Knowing when and how to submit your return helps you stay on track and avoid last-minute issues.

The 2025 tax year includes income and deductions from 1 July 2024 to 30 June 2025, and returns can be lodged starting 1 July 2025.

Below is a quick overview of the lodgement methods and their respective deadlines:

Do’s and Don’ts for tax season 2025:

Here are the essential practices to follow and the common mistakes to avoid to ensure your 2025 return is accurate, compliant, and fully supported by proper records:

DO: Maintain comprehensive and organised records

Keeping accurate records is one of the most critical responsibilities of any taxpayer. As the ATO uses a self-assessment system, you're responsible for ensuring your tax return is accurate and supported by proper documentation.

Best practices:

• Store all receipts, invoices, and other records using tools such as the ATO’s myDeductions app, which allows you to scan and upload receipts throughout the year.
• Keep records for at least five years from the date you lodge your return.
• For depreciating or CGT assets, keep records for the full ownership period plus five additional years after disposal.
• If a document supports claims in more than one return, keep it until the review period for the last return it was used in has passed.
• If your tax return is amended, start a new record-keeping period from the day after the amended notice is issued.
• Follow industry-specific rules if they require records to be kept for longer, such as seven years for PRRT.

DON’T: Assume five years is always enough

While five years is a standard guideline, it does not apply to every situation. Records reused in later returns or linked to amended assessments may need to be kept for longer. Disposing of them too early can result in compliance issues. Always consider how the record is used before deciding when to discard it.

DO: Ensure to claim eligible work-related expenses properly

Work-related deductions remain one of the most common sources of errors on tax returns. To be eligible to claim, the expense must meet three criteria:

• It must be incurred in the course of earning your income.
• You must have spent the money yourself (and not been reimbursed).
• You must have the evidence to prove it.

Acceptable deductions may include:

• Uniforms with employer logos.
• Tools and protective equipment.
• Mobile phone and internet use are apportioned for work.
• Travel between job sites (not home-to-work travel).

DON’T: Overlook working from home (WFH) deduction rules

With remote and hybrid work arrangements becoming standard, many Australians are eligible for WFH deductions. The ATO allows you to choose between two calculation methods:

Fixed Rate Method (2024–25):

• 70 cents per hour worked from home.
• Covers electricity, internet, phone, and stationery.
• Requires a record of actual hours worked, such as a diary or log.

Actual Cost Method:

• You claim actual expenses incurred for working from home, apportioned for business use.
• Requires comprehensive records, including receipts and usage logs.

Avoid:

• Claiming both fixed rate and individual components (known as double dipping)
• Claiming expenses for minimal tasks like checking emails or casual browsing.

DO: Declare all income sources

Full income transparency is critical. The ATO’s data-matching systems now cross-reference your tax return against bank records, investment portfolios, and platforms like Uber, Airbnb, and cryptocurrency exchanges.

Ensure you declare:

• Salaries and wages.
• Interest, dividends, and investment income.
• Rental income from property.
• Cryptocurrency gains or trading profits.
• Earnings from side businesses or freelance services.

Avoid:

• Omitting secondary income streams.
• Assuming minor or foreign-sourced income doesn’t need to be declared.

DON’T: Ignore tax offsets and concessions

Tax offsets can significantly reduce your tax payable, but many are underutilised due to a lack of awareness. While most offsets are non-refundable, they can still provide substantial financial relief.

Common offsets include:

• Low and Middle Income Tax Offset (LMITO).
• Seniors and Pensioners Tax Offset.
• Private Health Insurance Rebate.
• Franking credits (particularly for retirees).

Some offsets are calculated automatically; others must be claimed manually in the "Offsets" section of your return.

Avoid:

• Assuming all applicable offsets are pre-filled.
• Failing to check eligibility via ATO tools or your tax agent.

DO: Lodge on time or use a tax agent

The standard deadline for individuals to lodge their return is 31 October 2025. Failure to lodge on time can attract significant late lodgment penalties and interest. If you use a registered tax agent, you may qualify for an extended deadline. However, you must be registered with the agent before 31 October to be eligible.

Avoid:

• Waiting until the last minute to prepare.
• Assuming your agent automatically files without confirmation.

DON’T: Forget to update personal information

Outdated personal details can lead to missed refunds or ATO correspondence going astray. Keep your information up to date through your myGov account or via your tax agent.

Ensure that the following are current:

• Residential and postal addresses.
• Bank account details for refunds.
• Email and phone number.
• Marital status and dependents (which may affect your offsets).

DO: Use ATO Occupation-specific guides

The ATO publishes detailed tax deduction guides for various professions to help you understand what you can and cannot claim. These guides cover roles such as:

• Teachers
• Nurses and healthcare professionals
• Construction workers
• Hospitality staff
• IT professionals

They explain common deductions specific to your industry and help ensure compliance.

Avoid:

• Guessing based on what friends or colleagues claim.
• Applying rules that may not relate to your profession.

DON’T: Misreport cryptocurrency or capital gains

With the rise of digital assets and online investing, the ATO has ramped up its focus on capital gains tax (CGT) compliance.

You must report:

• Disposals of cryptocurrency (including crypto-to-crypto trades)
• Sale of shares and managed fund units.
• Rental property capital gains or losses.
• Inherited property sales.

Maintain a clear record of purchase prices, sale values, and transaction fees. Use tools or spreadsheets to track trades and earnings.

Avoid:

• Failing to report small or overseas transactions.
• Assuming crypto is anonymous or outside ATO oversight.

Final thoughts

Tax season doesn’t have to be a source of stress. By understanding the dos and don’ts outlined above, you can stay compliant, maximise your entitlements, and reduce the risk of ATO scrutiny. Success at tax time comes down to being prepared, keeping detailed records, and making informed decisions.

Whether you are claiming work-from-home expenses, declaring investment income, or managing business deductions, every part of your return matters. If you're unsure about what you can claim or how to approach your lodgement, getting the right advice is essential.

At ZedPlus, we support individuals and businesses with accurate, efficient, and proactive tax return services. From identifying eligible deductions to ensuring your return is complete and compliant, we’re here to help you approach tax time with clarity and confidence. Reach out to ZedPlus and let us take the complexity out of your tax obligations.