We have lots of people asking “How much does a tax return cost in Australia”. For the quick answer check out the table below:
- Self-lodgment through myGov: Free
- Basic individual returns with registered tax agents: $150-300
- Complex individual returns: $500-1000
- Small business returns: $800-2000+
- More complex business structures: $1,000-5,000+
Understanding Tax Return Costs
The cost of preparing and lodging a tax return in Australia varies significantly based on your circumstances and chosen lodgment method. While some Australians can effectively use free options, others benefit from professional services despite the higher costs. Here’s a comprehensive breakdown of what you can expect to pay.
Self-Lodgment Options
MyTax through myGov
The Australian Taxation Office provides a free online lodgment service through myGov, making it an attractive option for many taxpayers. While there’s no monetary cost, you’ll need to invest time in understanding the process and ensuring accurate lodgment. Most people spend between 2-3 hours gathering documents, entering information, and reviewing their return before submission.
MyTax automatically pre-fills information from employers, banks, and government agencies, significantly reducing data entry time. However, you’ll need to manually enter additional deductions and check that pre-filled data is complete and accurate. The system works well for straightforward tax affairs, but it provides limited guidance on complex matters.
Key benefits of MyTax include:
- Immediate lodgment confirmation
- Real-time tax calculation
- Access to previous returns
- Direct integration with ATO data
Tax Software Options
Commercial tax software bridges the gap between self-lodgment and professional services, typically costing between $85-300 per year. These programs offer more guidance than MyTax but without the expertise of a registered tax agent. They’re particularly useful for those with slightly more complex affairs who still feel confident managing their own returns.
Most software packages provide an interview-style approach, walking you through potential deductions and tax situations you might not have considered. However, they can’t provide personalised advice or guarantee the accuracy of your return.
If you like to do it yourself there is a great option from BGL Software called Simple Invest 360. This is great for small businesses and those who like to manage their own discretionary trusts. It starts from $200 + GST (plus a one-time set up fee) for a full accounting and investment package (a step up from Sharesight) and comes with the ability to log your own tax returns and create financial statements.
Professional Tax Agent Services
Basic Service Level ($150-300)
Professional tax services start with basic returns for individuals with straightforward tax affairs. At this level, you’re paying for the agent’s expertise, professional indemnity insurance, and their ability to identify common deductions you might miss on your own.
A basic service typically includes a short consultation, review of your documentation, and standard deduction assessment. Most agents at this level handle PAYG income, basic work-related expenses, and simple bank interest or dividend income. The process usually takes about an hour, including a brief discussion of your circumstances.
Mid-Tier Service ($300-500)
As your tax affairs become more complex, you’ll likely move into mid-tier service territory. This level is appropriate for individuals with multiple income sources, some investments, or extensive work-related expenses. Your tax agent will spend more time reviewing your situation and can offer basic tax planning advice.
The increased cost reflects:
- Longer consultation time (usually 30-60 minutes)
- More detailed document review
- Handling of multiple income streams
- Basic investment advice
- Year-round basic support
Complex Returns ($500-1,000)
Complex individual returns involve multiple elements that require careful consideration and planning. This service level is suitable for individuals with investment properties, significant share portfolios, or capital gains events. Tax agents handling these returns spend considerable time analysing your situation and identifying optimisation opportunities.
These services often include:
- Comprehensive tax planning
- Investment property analysis
- Capital gains calculations
- Multiple income stream optimisation
- Ongoing tax strategy advice
Business Returns ($800-5,000+)
Business tax returns require significantly more work than individual returns, hence the higher cost range. A sole trader with straightforward affairs might pay $800-1,500, while a company with multiple revenue streams and complex structures could pay several thousand dollars.
The cost varies based on:
- Business structure complexity
- Transaction volume
- Reporting requirements
- Additional compliance needs
- Whether bookkeeping is up-to-date
Tax agents handling business returns typically provide year-round support, help with BAS statements, and assist with tax planning throughout the year. They often become trusted advisors who understand your business intimately and can provide strategic advice beyond just tax compliance.
Making Your Choice
When deciding between self-lodgment and professional services, consider both the monetary and time costs involved. While self-lodgment might save money upfront, a professional service could identify additional deductions or tax-saving strategies that more than cover their fee. Remember that tax agent fees are tax-deductible in the following year’s return, effectively reducing the net cost of professional assistance.
Consider your circumstances, confidence level with tax matters, and the complexity of your financial affairs. Sometimes, the peace of mind that comes with professional handling of your tax affairs is worth the investment, particularly as your financial situation becomes more complex.
Cost-Saving Tips
Early Preparation Saves Money
Getting organised early can significantly reduce your tax return costs. Many accountants offer early-bird discounts during quieter periods, typically between July and September. Last-minute lodgments in October often attract premium pricing, with some firms charging up to 30% more during these peak periods.
The key to early preparation is maintaining good records throughout the year. Consider using a digital filing system or dedicated app to store receipts and important documents. This not only saves time but can reduce your accountant’s workload, potentially leading to lower fees.
Bundle Services for Better Rates
If you have multiple tax returns to lodge – for example, personal returns for you and your spouse, or business and personal returns – many accountants offer package deals. These bundles often represent savings of 10-20% compared to lodging returns separately. Some firms also provide discounts when you combine tax returns with other services like business activity statements (BAS) or financial planning.
Maintain Good Records Throughout the Year
Poor record-keeping is one of the main factors that drive up accounting fees. Consider implementing these practices:
- Use accounting software for business transactions
- Keep digital copies of all receipts
- Organise documents by financial year and category
- Maintain a log of work-related expenses
- Record vehicle logbooks when required
Choose the Right Service Level
Don’t pay for services you don’t need. If you have a straightforward tax situation, a basic service level might be sufficient. Conversely, if your tax affairs are complex, paying for a higher service level could save money in the long run through better tax planning and deduction optimisation.
Take Advantage of Technology
Many accounting firms offer lower rates for virtual consultations or online lodgment services. These can be 20-30% cheaper than traditional face-to-face services while providing the same level of expertise.
Common Extra Charges
Prior Year Tax Returns
Preparing returns from previous years typically incurs additional charges:
- Standard prior year return: $100-200 extra per year
- Complex prior year return: $300-500 extra per year
- Returns older than 5 years: May incur research fees of $200+ per year
- Reconstruction of missing records: $150-300 per hour
Urgent Processing Fees
Last-minute or urgent requests often attract premium charges:
- 48-hour turnaround: 25-50% loading on standard fee
- Same-day processing: 50-100% loading on standard fee
- After-hours appointments: $100-200 additional charge
- Priority processing: $150-300 extra
Additional Schedules and Statements
Complex tax situations requiring extra schedules or statements usually incur supplementary charges:
- Capital gains tax calculations: $150-300 per asset
- Rental property schedules: $200-400 per property
- Foreign income declarations: $250-500
- Business and professional items schedule: $200-400
- Personal services income calculations: $150-300
Amendment and Revision Charges
Changes after lodgment can be costly:
- Minor amendments: $100-200
- Major revisions: $300-500
- ATO audit assistance: $250-400 per hour
- Object to assessments: $500-1,000+
Special Circumstances
Certain situations require additional work and therefore attract extra fees:
- Deceased estate returns: $500-1,000 extra
- Bankruptcy returns: $400-800 extra
- Non-resident tax returns: $300-500 extra
- Multiple year catch-up lodgments: Premium rates apply
Ongoing Services
Regular tax support throughout the year may incur additional costs:
- Tax planning sessions: $300-600
- Mid-year reviews: $200-400
- Investment strategy consultations: $300-500
- Quarter business activity statements: $150-300 per quarter
Managing Extra Costs
Communicate Clearly
Be upfront about your requirements and deadlines. Many accountants will work with you to manage costs if they understand your situation. Ask for a clear fee structure and ensure you understand what’s included in the base price versus what attracts additional charges.
Plan Ahead
Most extra charges can be avoided or minimised with proper planning:
- Book appointments early in tax season
- Maintain organised records
- Communicate deadlines in advance
- Ask about package deals
- Consider quarterly or monthly check-ins to avoid year-end surprises
Get Everything in Writing
Before proceeding with any tax services, ensure you have a clear understanding of all potential charges. Request a written quote or engagement letter that outlines:
- Base service fees
- Potential additional charges
- Payment terms
- Service inclusions and exclusions
- Expected timeframes
Remember that while extra charges can seem significant, they often reflect substantial additional work required by your tax agent. In many cases, the expertise provided can result in tax savings that outweigh the extra costs.
