Tax tips for end of financial year
28 May 2021
If you're self-employed or run your own business, tax time is very different for you than those employed by someone else. Here are some tips and strategies to keep on hand for tax time.
Deposit up to $25,000 as a deductible super contribution. This will help reduce taxable income and potentially reduce tax paid, as deductible contributions are subject to a flat 15% tax rate.
Bring forward deductible expenses. Consider paying upcoming expenses in the current financial year so you can claim a deduction on them where appropriate - especially if you have a higher taxable income and want to offset some of the expenses.
Buy items that you need to run the business. If you need to update tools, software, workspaces or other items used to run your business, buy them now to claim the deduction this financial year.
Pay your staff their super on time. If you don't meet your payment obligations it can get costly, and you can lose the right to claim a deduction on what you have to contribute.
Have a car for work purposes? If you say it's 100% business use, then make sure it really is. The ATO have been known to check out branded vehicles at holiday destinations such as Fraser Island.
Keep a good handle on your expenses. It’s so much easier if and when the ATO come knocking to be able to produce all the receipts and up to date books you need to prove expenses. Running a tight ship is important.
Take action well before 30 June! Leaving things to the last minute, or not bothering at all will cost you. Talk to your accountant early to see if they suggest any steps to take before end of financial year.
We can work with you to provide affordable solutions or offer you a second opinion to make the most of your end of year finances. Book an obligation free appointment with a Skylight specialist now.