2021 End of Financial Year Tax Tips

on April 28, 2021 General with 0 comments

How would you like to legally increase your Tax Saving by $500 or $1,000 or $10,000 or more?

Effective planning and preparation is critical for all taxpayers as the end of financial year approaches. The good news is that your tax professional is here to support you so you don’t have to do all of the heavy lifting yourself. This is the perfect time of the year to seek advice from your accountant to maximise your tax savings for 2020-2021 and start planning fresh for next year.

9 tax planning tips for better tax outcomes for business owners:

1. Pay quarterly super

Super Guarantee (SG) contributions must be paid by 30 June 2021 to qualify for a tax deduction in the 2020-21 financial year.

2. Review capital expenditure

his financial year, the instant asset write-off allows eligible businesses to instantly deduct any amount spent on assets in their upcoming tax return.

3. Small business CGT concessions

Individuals operating a small business may be eligible for capital gains tax (CGT) concessions on the sale of business assets. The small business CGT concessions are available to business taxpayers with an aggregated turnover of less than $2 million or on business assets less than $6 million.

4. Stocktake

Obsolete, slow-moving or damaged stock should be identified by 30 June and disposed of for income purposes in order to receive a deduction.

5. Contact the ATO

The ATO is responsive to businesses struggling to keep on top of their tax obligations due to COVID-19. Businesses struggling to meet their tax obligations should contact the ATO to discuss deferring payments, make variations to PAYG quarterly tax instalments, or change their GST reporting cycle from quarterly to monthly to receive quicker access to GST refunds.

6. Defer income

Businesses may wish to delay tax payments on assessable income this financial year by deferring invoices until after 30 June so that income from the payments won’t be taxed until the following financial year.

7. Family Trusts

Remember that family trusts must decide who is receiving the trust’s income and capital before June 30th.

8. Bad Debts

Bad debts are a significant cost to all businesses that sell on credit. There is no sense in paying tax and GST on sales where payment will not be received, so reviewing any bad debts before the end of the year is important.

9. Prepaying Expenses

There may be expenses due early next year, but tax deductions can be brought forward for the next year by pre-paying them in June.

We are here to help you. Please contact us for an arrangement to review your Year-End Strategies and answer any questions you have about your 2021 tax.

Remember, if you spend a little bit of time with us to review your financial situation and discuss your tax planning options, you could end up saving yourself thousands of dollars.

Now is the time to do it – please contact our office TODAY to get started!!