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Why is my tax return so low in 2023?

There could be a few reasons your return refund doesn't look as robust as in past years, according to the ATO:

  • Your refund could have been offset against other debt you have

  • There could be a difference between the details in your tax return and the pre-fill information data

  • Your income and deductions are different from last year.

But the most likely culprit for a low refund — or even a tax bill — is the discontinuation of the low and middle income tax offset (LMITO).

Introduced in 2018/19 Budget, the LMITO gave those earning between $37,000 and $126,000 a tax benefit of up to $1,500 depending on how much they earned.

Those earning between $40,001 and $90,000 got the full $1500 offset.

The ATO reported that more than 10 million people claimed the LMITO in the 20/21 financial year.

Well, the good times are over as the LMITO ran out on 30 June 2022.

So, if you have a discrepancy of about $1,500 in your 22/23 return refund, the missing LMITO could be the cause.


How to contact us

We’re available to assist you with tax planning including tax deductions:

  • Contact Collins Hume Accountants & Business Advisers in Ballina or Byron Bay on 02 6686 3000

  • Read more tax planning topics here »

  • Access our free tax factsheets here »

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