Individual tax return instructions supplement
From this year, the Individual tax return instructions supplement 2013 is only available online.
You can get a paper copy of the form Tax return for individuals (supplementary section) 2013 from our Publications Distribution Service (see inside back cover).
Business and professional items
The ATO is progressively moving to electronic methods to provide instructions and tax return lodgment options for taxpayers with more complex affairs. For this reason, from this year, if you are required to complete the Business and professional items schedule you cannot lodge a paper tax return. You must lodge your tax return online or a registered tax agent.
This will affect you if any of the following applied in 2012-13:
- you were a partner in a partnership that made a loss
- you received income for personal services you provided as a sole trader
- you derived income or incurred a loss from any business
- you conducted a business activity that resulted in a loss.
Increased tax free threshold
The tax-free threshold has been increased to $18,200. To check whether you need to lodge a tax return, go to Do you need to lodge a return?
Changes to the private health insurance rebate
Your entitlement to the rebate will now depend on your level of income. You will receive a statement from your private health insurer which you will need to complete your tax return.
You may now be eligible for a private health insurance rebate if you were covered by private health insurance, regardless of who paid for the policy. If you are covered as a dependent child on the policy, you are not eligible for the rebate but will not have to pay the Medicare levy surcharge.
Medicare levy surcharge thresholds
The Medicare levy surcharge is now determined by new income thresholds. There is no change to how the Medicare levy surcharge applies, or to any exemptions that may apply to your circumstances.
|
No change |
Threshold 1 |
Threshold 2 |
Threshold 3 |
Singles |
$84,000 or less |
$84,001-97,000 |
$97,001-130,000 |
$130,001 or more |
Families |
$168,000 or less |
$168,001-194,000 |
$194,001-260,000 |
$260,001 or more |
Rate |
0.0% |
1.0% |
1.25% |
1.5% |
The family threshold will increase by $1,500 for each dependent child after the first.
Income test labels
You must complete items IT1 to IT8. If you have a spouse, you must also complete all spouse income items.
We use this information to calculate your entitlement to certain offsets or government concessions, and the private health insurance rebate. We will also use the information to work out whether you need to pay tax or the Medicare levy surcharge.
Carefully check the values at the income tests labels before submitting your return.
Dependant tax offsets
There are changes to how you claim for certain dependants:
- If your spouse was born on or after 1 July 1952, you can no longer claim a dependent spouse tax offset for them at item T1.
- You can only claim the housekeeper and child housekeeper tax offsets if you are eligible for a zone or overseas forces tax offset at item T5.
- If you are not eligible for a zone or overseas forces tax offset, the new dependent (invalid and carer) tax offset at item T7 replaces offsets for your:
- spouse born on or after 1 July 1952
- parent
- parent-in-law
- invalid relative.
To be eligible for the new offset, your dependant must receive a government payment as an invalid or carer or be caring for someone who receives a government payment as an invalid.
At the time of printing these changes had not become law.
Go to for information about the progress of this legislation.
Net medical expenses tax offset
The amount of net medical expenses tax offset you can claim will now depend on your level of income.
You will only be able to claim an offset of 10% of your net medical expenses over $5,000 if you have an adjusted taxable income (ATI) above:
- $84,000 if you are single, or
- $168,000 if you are a couple or family.
The family threshold will increase by $1,500 for each dependent child after the first.
If your ATI is below these income thresholds, you are not affected by this change and can continue to claim an offset of 20% of your net medical expenses over $2,120.
At the time of printing these changes had not become law.
Go to for information about the progress of this legislation.
Pensioner tax offset and Senior Australians tax offset
The pensioner tax offset and the senior Australians tax offset have been combined to form the seniors and pensioners tax offset, which can be claimed at item T2.
Low Income Super Contribution (LISC)
From 1 July 2012, you may be entitled to a low income super contribution (LISC) if your adjusted taxable income (ATI) is no more than $37,000 and at least 10% of your total income is from employment or business.
The LISC is a government super payment to help low income earners save for their retirement. The payment is 15% of the concessional (before tax) contributions made by you or your employer to your complying super fund, up to a maximum payment of $500 (minimum payment is $10).
The ATO will calculate your entitlement using information you provide in your tax return.
Mature age worker tax offset
The eligibility test for the mature age worker tax offset has changed. From 1 July 2012, this tax offset is only available to taxpayers born before 1 July 1957.
Employment termination payments tax offset
Employment termination payments (ETPs) are now taxed differently. A $180,000 cap, based on your yearly taxable income, is now applied to limit the concessional tax treatment of certain types of ETPs.
Transitional termination payments ended on 30 June 2012, although earlier year payments may affect the tax treatment of your ETP this year if they relate to the same termination of employment. Instructions at this question have been updated to reflect this change.
You can go to for more information.
Conservation tillage refundable tax offset
The government has introduced a refundable tax offset for purchase of an eligible no-till seeder used in conservation tillage farming practices. Qualifying primary producers may be entitled to a refundable tax offset of 15% of the cost of the seeder. To be eligible for the offset, seeders must be installed and ready for use between 1 July 2012 and 30 June 2015.
The offset can be claimed at item T11 in the supplementary section of your tax return.
You can go to for more information.
A list of new initiatives incorporated in this year's Individual tax return instructions.