Although it may seem a little incredulous, many of us are paying more tax than we have to. How can that be you may ask as, every year you file a tax return and if you paid too much, you would receive personal tax refunds but whilst that is true, you will only receive a refund, if you correctly claimed, on that return, any and all tax exemptions you may be entitled to. No government will usually pay a tax refund unless it has been asked for or at least clearly indicated that one is due. The reason why we do not claim these refunds, and apparently there are a large number of us that don’t, is because we are not always aware of all the tax exemptions that exist. Every year and certainly over a number of years, a government may allow certain claims to be made against the amount of tax you pay. These exemptions may be to assist you in paying a child’s tuition fees or in fact assist with the expenses of a new born child. They may be exemptions allowing for any sick periods you may have had to take off work during the previous year or they may make allowances for a sickness or death in the family, none of which though, they will know apply to you unless you mention them in your tax return. It is this ignorance of the exemptions or other reasons why certain personal circumstances are left off of tax returns that these refunds go unclaimed. As more and more people realize that there are a growing number of unclaimed refunds every year, some are fully looking up any exemptions which are in existence, prior to filling in their tax returns or, are resorting to hiring a tax professional to fill in the tax return or them. As taxes are their business, tax professionals keep abreast of all exemptions to taxes which exist for both businesses and individuals and can thereby quickly and easily complete your tax return and yet, ensure that all possible reductions in tax are clearly displayed in the correct places. When assisting with personal tax returns, these professionals often find that their clients were unaware of certain exemptions and so afford the clients to pay less, as to whether or not the amount of tax that the client saves, is enough to pay for the professional’s fees is another matter. If an exemption applies in one year though, there is a good chance that it will also exist in the following year and so if you only consult a professional every 3 to 4 years, the combined savings over those 3 or 4 years, certainly will pay a professional’s fees or the year they gave assistance.
Hiring a professional to help with your tax return this year, can therefore be cost effective, if not over just one year but certainly over the next 3 or 4 years and it ensures that none of the unclaimed refunds are ever yours.