Tax Time 2026: Don’t Get Caught Out by Budget Headlines
By Tina Zawila
With tax time fast approaching, many employees are starting to gather their paperwork and think about their refund. This year, there’s an important message I’m sharing with clients: don’t let recent Federal Budget headlines mislead you when lodging your 2026 tax return.
The $1,000 deduction – not for this year
You may have heard about the Government’s proposed $1,000 “standard deduction” for work-related expenses. While it sounds appealing, it does not apply to the 2025–26 financial year (the return you’ll lodge from 1 July 2026). If passed as legislation, this deduction will be available from 1 July 2026, which means it will first apply to 2026–27 tax returns lodged in 2027. Therefore, you still need to follow the current rules, keep records and claim actual work-related expenses that can be substantiated.
The $250 tax rebate – also not for this return
Another announcement to be aware of is the proposed $250Working Australians Tax Offset, sometimes described in the media as a tax rebate. This is intended to provide an ongoing annual tax offset of up to $250 for workers, including employees and eligible sole traders. However, it is proposed to apply from the 2027–28 income year, for income earned from 1July 2027, and would generally be applied automatically after the tax return is lodged. In other words, it is not something taxpayers can claim in their 2025–26 tax return, and it should not be factored into this year’s refund expectations.
Tips for 2026 tax time
· Keep receipts, invoices, logbooks and other evidence for work-related expenses you intend to claim.
· Only claim deductions that relate to earning your income and that you can substantiate if asked.
· Declare income from all sources and review your bank interest, dividends and private health insurance details before lodging.
Engaging with a professional registered tax agent can help you lodge with confidence, avoid unnecessary and costly mistakes and make sure you are not missing legitimate deductions under the current rules.
Call the professional team at UHY Haines Norton CQ on 49721300 to book your 2026 tax appointment now.
