We are heading fast towards 30th June 2021 and now is the perfect time for forecasting and tax planning. We have put together a few strategies for you to consider that will help you get the most out of your tax. As everyone’s situation is different, it is always important to seek advice before you take any action.
Tax time strategies
Any obsolete stock — Take careful note when completing your annual stock take.
Prepaying expenses — Prepaying expenses such as insurance, rent and subscriptions. Up to 12 months of the following years expenses may be able to be deducted in the current tax year.
Superannuation — Top up superannuation contributions and ensure that you pay all or most of the June quarter Superannuation Guarantee payments prior to the end of the financial year. Remember in most circumstances the payments need to be received by the employees super fund prior to 30 June for the super contribution to be deductible in the current financial year.
Use of Loss Carry Back measures — Eligible corporate entities that previously had an income tax liability in a relevant year and have subsequently made taxable losses can claim a refundable tax offset up to the amount of their previous income tax liabilities.
Vary down PAYG Instalments — Tax forecasting may uncover the ability to vary down your instalments.
Instant Asset Write-off & Cashflow — Taking advantage of the instant asset write-off whilst taking into consideration cash flow needs and the needs of your business, or because it is in line with your business plan. From 12 March 2020 until 31 December 2020, the instant asset write-off threshold is $150,000 (up from $30,000).
Tax planning is an important part of running a successful business. It helps to identify opportunities to reduce tax, but it can also serve as an annual business health check.
If you need any help at all with getting your taxes ready or coming up with a plan, please don’t hesitate to reach out.