The end of the financial year is a common time for businesses to evaluate their year’s performance and take advantage of any tax-saving opportunities available. While meeting with clients to discuss the strategies available, we noticed the same strategies popping up for many different clients. For your benefit, we have collated this list of core tax tips to help your business get the most of out of tax time and reduce that tax bill!
Tax-time strategies to be implemented before 30th June 2016:
- Do you have lots of invoices to issue before 30 June? Are you able to delay issuing these invoices until after 1 July? Or, if you are accounting on a cash-basis, are you able to delay the receipt of income until after 1 July?
Write off bad debts
- Long-outstanding debtors could indicate lost income; for previously accounted income, this could generate an expenses to offset, or simply counter-out the income completely.
Pay Superannuation Guarantee Contributions before 30 June 2016
- While the ATO will still allow a deduction if the June quarter Super contributions are paid before 28 July, they will only count as a 2016FY deduction if paid before 30 June. If cashflow allows – pay early.
Pay Additional / Salary Sacrifice Superannuation Contributions
- Additional Super contributions (up to your age-based limit) can also be paid before 30 June 2016 to receive the deduction.
Other Payroll Expenses
- Pay staff bonus;
- Pay Director fees or dividends;
- Adjust owners’/directors’ wages if necessary (to achieve better tax outcome).
Prepay Expenses / Additional Purchases
- Prepay expenses (rent, insurance etc) for up to 12 months (SBE) or up to $1,000 (non-SBE).
- Additional deductible expense payments/purchases – software, travel expenses etc. Bring forward necessary purchases that may have otherwise been delayed – e.g. computers, office equipment etc
- Remember the Asset Immediate Write-off concession for Small Business Entities, for assets that are purchased and ready to use, with a purchase cost of less than $20,000+gst (or $300+gst for non-SBE).
If you require any further assistance please call our office on 9299 7044. For more information on Bookkeeping items that may need attention prior to 30 June 2016, please see our 'End of Financial Year Checklist' article.