How are Australians spending their tax returns?
I know tax season is right around the corner when I start hearing people talk about what they are going to spend their tax return on. For many people they tend to see it as a forced savings situation, so when that time of year comes around the spending juices get flowing.
So what do Australian’s typically spend their tax return on? Well our friends over at MoneySmart did some investigations and found out for us. Thanks guys, you’re a gem.
Firstly, for interests sake, approximately 70% of Australians get a tax return. Remember it is not guaranteed and sometimes you actually owe more! So don’t go spending before you know what you are getting.
The average tax return you are expected to receive in Australia is $3,140 per person. 27% of Australian do their own tax meaning the remaining outsource to the professionals such as accountants or registered tax agents.
The good news is us Australian’s tend to be a responsible bunch. The majority of people put their tax return towards the sensible stuff like loans, bills and savings. The below table outlines this for you:
31% saved it
18% loans or credit card payments
11% home loans
24% paid bills
So as you can see approximately 66% of all tax returns are going to paying down bills, homes and the dreaded credit cards.
Where does the rest of it go?
Holidays, appliances like TV’s, engagement rings, shopping, parties and cars make up 16% of the total tax returns.
So with tax time right around the corner where do you sit? Will you be paying down bills and patting yourself on the back or will you be splurging on the fun stuff?
The post is from our resident Financial Planner Cara Brett, check out her details in the About Us section.