A Medical Transcriptionists (MT) who works online from home is usually classified as an independent contractor. When tax time rolls around, independent contractors can claim a number of deductions related to the cost of doing business. As this can be a new experience for many MT’s, we have listed some great ways to make the most of your tax return.
Keep your receipts – all of them.
Keeping all of your receipts will be useful when filing your taxes. There are a number of apps available to help keep track of your receipts, expenses and tax obligations (such as Pocketbook).
When it comes to working from home you should be keeping track of every deduction you’re legally entitled to. Every deduction you don’t take advantage of could end up costing you over the course of the year.
Are there expenses that you incurred due to your work? You may be eligible to claim these expenses as work costs. For a Medical Transcriptionist working from home, you may be entitled to deductions on your internet, electricity and latest computer purchase. You don’t want to think too creatively with these, but at the same time, don’t limit what you may be entitled to. Only deduct expenses that can truly and logically be applied to your work.
Work out what you can claim
The home office expenses calculator developed by the Australian Tax Office (ATO) could be a useful tool to help you calculate the amount you might be able to claim as a tax deduction for home office expenses. This tool is designed to assist people working from home and may not cover all considerations.
Working as an Independent contractor for an overseas company
There are a number of specific rules that apply in the instance of services used outside of Australia. Working as a Medical Transcriptionist within Australia for an overseas company means that your services do not include Goods and Services Tax (GST). Generally, a supply of a service is GST-free if the recipient of the service is outside Australia and the use of the service is outside Australia.
Get an ABN
An ABN (Australian Business Number) is a unique 11-digit identification number that identifies yourself as an independent contractor to the Australian government and community. To apply for an ABN, you may do so here. The application process is quick and easy!
Hopefully this has helped you understand some of your tax considerations as an independent contractor. If there is anything you are unsure about, there are a number of great tools developed by the Australian Tax Office that may be of assistance for Independent Contractors. Please note, these tools are to assist with areas that you may be able to claim on. If there is anything you are unsure of, please contact a tax accountant.
Get qualified as a Medical Transcriptionist
If you are interested in learning more about TalentMed’s Diploma of Healthcare Documentation and how you can begin your career as a Medical Transcriptionist, please contact our Career Advisers today on 1300 737 781.