Tax Return Guide for Medical Professionals

If you are a practising medical professional — be it a doctor, specialist, dentist, or anyone else in the healthcare industry — there is a range of income and work related tax deductions you may be eligible for. This is particularly true for those who own their own practice.

Come tax time, understanding these deductions can save you a significant amount of money. However, the medical industry is like any other — except, perhaps, accounting — in that those working in the field don’t necessarily always understand their taxation obligations. 

The role of a doctor or specialist is to provide high-quality healthcare, not be on top of their taxes. This tax return guide for medical professionals should provide you with basic information about your obligations and deduction opportunities, but keep in mind that nothing will replace the advice of a taxation professional working in medical accounting services.  

As is the case for any profession, all income earned as a medical specialist must be reported on your tax return. This includes salary and wages, as well as allowances.

If you run your own practice, you will have additional income reporting obligations as a business owner. It will come as no surprise that completing a tax return for a business tends to be more complex than doing so as an individual, which is why many practice owners choose to outsource this task to professional medical accounting services.

While no two tax returns will be alike, even for professionals working in the same field, there is a range of common deductions that most medical specialists will qualify for. These include:

Travel and car expenses: Do you own or work at multiple locations? Costs incurred whilst travelling between these locations may be eligible for deductions.

Tools and equipment: It goes without saying that running a medical practice requires a lot of equipment. From general consumables (like PPE) to high-powered capital equipment, any medical supplies and devices you purchase may be tax deductible. 

Office expenses: A medical practice is like any other type of office in that many operating costs, such as electricity and maintenance, can be claimed on tax. 

Self education: Professional development is important in all fields, particularly the medical industry. Staying up to date on contemporary research can help improve patient care. Whatsmore, self-education expenses can often be reimbursed in your tax return, providing that they relate specifically to your field of work.

These are only a small handful of the types of deductions a medical professional can claim. Keep in mind that the ATO encourages tax planning — or arranging your financial affairs to keep tax to a minimum — providing that it is undertaken in a legal manner.

Understanding the nuances of your tax obligations and benefits is not a simple task. As a medical professional, you’re likely already very busy taking care of patients and running your business. One of the best things you can do for your own sake and that of your employees is outsource your tax and financial planning to a professional who provides medical accounting services. Let them take care of the numbers while you focus on doing what you do best. 

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