How to save
Boost your super
Want to save for the future while cutting down your tax bill? Adding extra money to your super (on top of what your employer already contributes) could be a great option. Depending on your circumstances, you might be able to contribute up to $30,000.
If your super balance is under $500,000, and you haven’t used your full limit for the last five years, you can top it up this year. For example, if you missed $8,000 each year for five years, you might be able to contribute $40,000 this year, reducing your taxable income.
If your spouse earns less than $37,000, you could also contribute to their super and get a $540 tax offset. Double win! Just make sure to check all eligibility requirements and submit the right notices to your super fund before lodging your tax return.
Claim your donations
Ever donated to a registered charity or organisation? If so, you can claim donations of $2 or more on your tax return. But keep in mind, you can only claim amounts given without receiving anything back, like raffle prizes or items from charity events.
If you’re thinking big, contributing to a public or private fund for ongoing giving could also get you an immediate tax deduction while helping your philanthropy goals long-term.
Investment property perks
If you own a rental property, you might be able to claim deductions for wear and tear with a depreciation schedule. This helps ensure you don’t miss out on legally available deductions from your property’s aging assets.
Avoid these risks
Home office claims
Working from home is now part of daily life for many of us, but be mindful of what the ATO allows. You’ve got two methods to claim costs for things like electricity, internet, and supplies:
- Shortcut Method - Claim 70 cents for every hour worked from home without needing to calculate individual costs.
- Actual Costs Method - Add up your actual extra costs, but be sure to keep all receipts and records for at least four weeks of work.
Whichever option you choose, keeping accurate records is key to making a claim that sticks.
Property expenses
When claiming expenses for a rental property, remember the ATO keeps a close eye on this area. For claims to be valid, the property must be rented out or legitimately available for rent. Here are a few things to consider:
- Only claim interest on loans directly used for the rental property. Personal redraws don’t count.
- Repairs that fix everyday wear and tear can be claimed straight away, but big improvements, like replacing a fence, have to be spread out over several years.
- If you share ownership of the property, you must split claims according to your ownership share.
Gig economy earnings
If you’re earning money through platforms like Uber, Airbnb, or YouTube, make sure to report it. Even if the money is still sitting in the platform account or hasn’t reached your bank account yet, it’s considered taxable income.
Since some platforms now report directly to the ATO, it’s better to declare everything upfront rather than face penalties later.
Smart moves for business owners
Write off bad debts
If a customer isn’t going to pay you, don’t hold onto false hope. Write it off as a bad debt before 30 June, so you can claim it as a tax deduction for this financial year. Make sure you document it properly in your records.
Scrap old equipment
Got old machinery or equipment you’re no longer using? If it’s still on your books, you can scrap it before June 30 and claim it as a full deduction.
Pay staff and super early
One way to cut down on tax is by bringing forward some expenses. If it makes sense for your business, you can book directors’ fees or bonuses now, or prepay super for the June quarter.
Watch out!
Meet deadlines
Always lodge your tax returns and reports on time. Falling behind might flag your business with the ATO, and they can issue an estimate of what they think you owe—even if it’s not accurate. If you’re struggling, ask for professional help to negotiate with the ATO.
Fair pay in professional firms
If you’re running a professional business like accounting or law, the ATO monitors how profits are distributed in the business. Paying yourself fairly and ensuring your structure is transparent can help avoid red flags.
Start planning today
The closer we get to the end of the financial year, the more hectic life can get. By reviewing your finances now, you can grab some great opportunities and avoid making costly mistakes.
If you’re unsure where to start, our team at LEAD Advisory Group can help. Give us a call and we’ll guide you through the process so you can feel ready for whatever the new financial year brings!
