Tax return tips

Before you lock in your tax return spending, here's a few ideas to consider.

Small Business Tips

Many people are already planning what they'll do with their tax refund money. Shopping? Holiday around Australia? Bills?

We thought we'd share a few ways to help you either save those funds wisely, or get the most out of your shopping spree.

Savvy people are saving their refund wisely

In 2019-20 the average tax return in Australia was over $2,6001. This amount of money can have a big impact when used wisely. The first thing to consider is whether you can reduce any personal debt, or save it. Particularly if you aren't quite ready to make a purchase, you can get your money to save you (or earn you) interest while you make a decision. 

1. Reduce your home loan

If you have a 30 year home loan, a one-off $2,000 lump sum repayment on a $400,000 loan at 2.54%p.a. could save you over $2,167 in interest over the life of your loan (without including any costs that may be incurred for lump sum payments), and would end your loan term two months earlier2

2. Pay off your credit card

According to, the average Australian credit card debt in Australia in April 2021 was $2,899. If you are aiming to pay down your credit card balance, put your refund onto your credit card. If you have a credit card debt of $2,899, you could save over $3,847 in interest by making higher repayments. This will help you wipe your credit card debit sooner than if you were just making the minimum repayment3.

3. Save it

If you consider stashing your tax refund in a high interest savings account like our Online Saver, your annual tax refund could grow to over $12,243 in just 5 years if you chose to save $2,000 of your refund each year4. That could buy you a great holiday, help with your home renovations or simply give you the reassurance of having a nest egg for the unexpected!

Go shopping and find some bargains

Let's be honest, using your tax refund for a little splurge is a great way to reward yourself for all your hard work throughout the year. Remember to shop around to get the best price on whatever you are planning to buy.

  • Support local businesses - This has become more important than ever in 2021. Local stores, whether you shop online or face-to-face, are often very competitive with price. Along with hands-on personalised service and advice, you get the added benefit of knowing your contributing back into your local community through your purchase.
  • Shopping online with your Heritage Visa debit or credit card comes with its own benefits. If there is something you've had your eye on outside of Australia, you're not restricted by your location. It's a great way to shop in London, New York and Paris, without paying the airfare! Just keep an eye on exchange rates and currency conversion fees, and make sure you stay scam aware.

Whether it's a new piece of furniture for home, watching your savings balance grow or slashing your personal debt, we know you'll find great use for your tax refund.

If you'd like more information about using your tax refund to help reduce your personal debt – or saving it – talk to us today. We can even make an appointment with one of our financial planners for you.


1. According to the Commissioner of Taxation Annual Report 2019-20 based on $17.2 billion in refunds issued by September 2020, divided by 6.6 million current tax returns.

2. Savings of $2,167 calculated using the Heritage Bank Extra Repayment Calculator with amount owing of $400,000 and lump sum deposit of $2,000 in year 1 of the loan.

3. Savings of $3,847 calculated using the Money Smart Credit Card Calculator with amount owing of $2,899 and interest rate of 16.00%.

4. Savings of $12,243 calculated using the Heritage Bank Savings Calculator with default interest rate, $2,000 starting balance and an additional $2,000 added each year for five years.

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