The Times Australia
The Times World News

.
The Times Real Estate

.

myTax is fast and free – so why do 2 in 3 Australians still pay to lodge a tax return?

  • Written by Jawad Harb, PhD Candidate, RMIT University
myTax is fast and free – so why do 2 in 3 Australians still pay to lodge a tax return?

Ten years ago, the Australian Taxation Office (ATO) created the “myTax” portal, an easy way to lodge your tax return online.

There was an “e-Tax” filing option before the 2015-16 tax year, but this was quite complicated and barely better than filling out a form online.

In comparison, myTax is simpler[1] and more automated. It’s available 24 hours a day, is free to use, and you will typically get your refund within two weeks[2].

But the chances are you won’t be using it.

In fact, slightly less than 36%[3] of Australia’s 15 million taxpayers used the myTax portal in 2020-21 – the most recent tax year for which the tax office has published data.

About 64% of tax returns[4] were lodged through tax agents. This is one of the highest rates among 38 Organisation for Economic Co-operation and Development[5] nations. Meanwhile, just 0.6% of Australians still used the paper-based form.

So why have Australians – who have quickly embraced the internet for everything from shopping to dating – been so slow to embrace myTax?

For some, particularly older people, it’s about being intimidated by the technology. Others may be concerned with cybersecurity risk.

But for most it’s about the perceived complexity of the tax system and the process, regardless of the technology. They see using a tax agent as easier and the way to maximise their tax refund.

While in some cases this may be true, in many instances it’s simply a perception – but one the tax office will need to address if it wants to promote use of myTax.

Read more: A tax expert's tips on claiming crypto losses on tax, and how to work out capital gains[6]

Reasons for the low uptake of myTax

Our research[7] suggests most people who have used the myTax portal think it is easy to use.

We surveyed 193 taxpayers who have used the system. About three-quarters agreed the system was clear and understandable, and said they would keep using it.

But of course these are people who have chosen to use the system, so their responses don’t shed much light on the reasons people don’t use myTax.

Answers to that come from other published research, in particular from the Inspector-General of Taxation[8] (the independent office investigating complaints about the tax system) as well as the House of Representatives’ Standing Committee on Tax and Revenue.

Evidence submitted to these bodies indicate that Australians prefer tax agents to avoid errors in claiming deductions.

The parliamentary committee’s 2018 inquiry[9] into the tax system was told the use of tax agents ballooned from about 20% in the 1980s, peaking at about 74% of all taxpayers:

The Tax Commissioner considered that the size of the TaxPack had probably contributed to that rise, driving many people with simple tax affairs to a tax agent because it looked daunting.

Australians' use of tax agents spiked during the 1980s and has remained high ever since.
Australians’ use of tax agents spiked during the 1980s and has remained high ever since. Shutterstock

In short, habits are hard to break. Having come to rely on tax agents, most Australians keep using them, despite the system being vastly improved.

For example, the myTax system now simplifies the process by pre-filling[10] data from government agencies, health funds, financial institutions and your own employer. About 80% of our survey respondents said this was helpful.

Taking care of the digital divide

This suggests the main barrier to increasing use of the myTax system is mostly habit and the perception the tax system is too complicated to navigate without an expert.

There is also a small percentage of people who feel uncomfortable with computers. This is reflected in the minority of respondents in our study who said they were unlikely to use myTax again, as well as the tax office’s data showing some people continue to stick with paper lodgement.

Those more likely to find the system daunting are the elderly, those with low English skills, people with disabilities and those with low educational attainment.

Read more: The downside of digital transformation: why organisations must allow for those who can’t or won’t move online[11]

These people’s needs should not be forgotten as the Australian Digital Government Strategy[12] aims to making Australia a “world-leading” digital government by 2025, delivering “simple, secure and connected public services”.

Even with the greatest online system in the world, it’s unlikely there will ever be a complete transition.

References

  1. ^ is simpler (resources.taxinstitute.com.au)
  2. ^ two weeks (www.ato.gov.au)
  3. ^ 36% (www.ato.gov.au)
  4. ^ 64% of tax returns (www.ato.gov.au)
  5. ^ Organisation for Economic Co-operation and Development (www.oecd.org)
  6. ^ A tax expert's tips on claiming crypto losses on tax, and how to work out capital gains (theconversation.com)
  7. ^ Our research (resources.taxinstitute.com.au)
  8. ^ Inspector-General of Taxation (www.igt.gov.au)
  9. ^ 2018 inquiry (parlinfo.aph.gov.au)
  10. ^ pre-filling (www.ato.gov.au)
  11. ^ The downside of digital transformation: why organisations must allow for those who can’t or won’t move online (theconversation.com)
  12. ^ Digital Government Strategy (www.dta.gov.au)

Read more https://theconversation.com/mytax-is-fast-and-free-so-why-do-2-in-3-australians-still-pay-to-lodge-a-tax-return-207305

The Times Features

Why Regional Small Businesses in Bendigo Deserve Better Access to Finance in 2025

In the heart of regional Victoria, Bendigo has long stood as a beacon of innovation, resilience and community spirit. As we step further into 2025, the importance of nurturing sm...

Is It Time for a Deep Cleaning? Signs You Shouldn’t Ignore

Most people know they should visit the dentist for a regular check-up and cleaning every six months. But sometimes, a standard cleaning isn’t enough. When plaque and tartar build...

The Hidden Meaning Behind Popular Engagement Ring Cuts

When it comes to engagement rings, the cut of the diamond is not just about aesthetics. Each shape carries its own symbolism and significance, making it an important decision for...

Annual Health Exams in the Office: How They Can Reduce Sick Days and Healthcare Costs

Regular health check-ups, especially annual health exams in the office, can significantly impact the overall well-being of your workforce. A proactive approach to employee health...

Best Deals on Home Furniture Online

Key Highlights Discover the best deals on high-quality outdoor furniture online. Transform your outdoor space into a stylish and comfortable oasis. Explore a wide range of d...

Discover the Best Women's Jumpers for Every Season

Key Highlights Explore lightweight jumpers for spring and summer, ensuring breathability and ease. Wrap up warm with cozy wool jumpers for the chilly autumn and winter season...

Times Magazine

The Essential Guide to Transforming Office Spaces for Maximum Efficiency

Why Office Fitouts MatterA well-designed office can make all the difference in productivity, employee satisfaction, and client impressions. Businesses of all sizes are investing in updated office spaces to create environments that foster collaborat...

The A/B Testing Revolution: How AI Optimized Landing Pages Without Human Input

A/B testing was always integral to the web-based marketing world. Was there a button that converted better? Marketing could pit one against the other and see which option worked better. This was always through human observation, and over time, as d...

Using Countdown Timers in Email: Do They Really Increase Conversions?

In a world that's always on, where marketers are attempting to entice a subscriber and get them to convert on the same screen with one email, the power of urgency is sometimes the essential element needed. One of the most popular ways to create urg...

Types of Software Consultants

In today's technology-driven world, businesses often seek the expertise of software consultants to navigate complex software needs. There are several types of software consultants, including solution architects, project managers, and user experienc...

CWU Assistive Tech Hub is Changing Lives: Win a Free Rollator Walker This Easter!

🌟 Mobility. Independence. Community. All in One. This Easter, the CWU Assistive Tech Hub is pleased to support the Banyule community by giving away a rollator walker. The giveaway will take place during the Macleod Village Easter Egg Hunt & Ma...

"Eternal Nurture" by Cara Barilla: A Timeless Collection of Wisdom and Healing

Renowned Sydney-born author and educator Cara Barilla has released her latest book, Eternal Nurture, a profound collection of inspirational quotes designed to support mindfulness, emotional healing, and personal growth. With a deep commitment to ...

LayBy Shopping