That time again, pre-end of financial year tax planning usually involves forecasting taxable incomes and includes preparing tax minimising strategies that need to be adopted before June 30. There are also a number of things you should consider yourself prior to the end of the year, here is my top ten for this year.
1.Does anything need repairing in a rental property or business premises. If the repairs are brought forward (i.e. prep 30 June) it allows you to write off the expense in this financial year. However, don't confuse 'repairs' with 'improvements and renovations' as these are handled in a different way and are usually written-off over 25 or 40 years.
2.Can you fill up the office supplies and stationery cabinet before year-end?
3.Think about paying subscriptions to professional journals and memberships to professional associations before the end of the financial year.
4.If you intend travelling for business early next financial year, consider booking and Accelerate and maximize tax deduction paying for the airfares and accommodation before 30 June. Same strategy with seminars and conferences that take place after the end of the financial year.
5.Check your cash-flow forecast to determine what deductions you are able to bring forward. Decide whether prepaying motor vehicle registration and compulsory third party insurance is feasible.
6.Consider prepaying insurance premiums if they fall in July or August i.e. workers compensation, building insurance, income protection insurance, professional indemnity or keyman insurance.
7.Prepay rent on your business premises.
8.If required purchase assets and equipment, office equipment and motor vehicles. This year there is instant asset write off available of up to $6.500
9.A big deduction is available for prepaying interest paid on investment loans if cash flow allows.
10.Analyse your debtor's ledger before 30 June to identify bad debts. Make a genuine attempt to recover the debt by year-end so you can decide whether or not the debt is 'bad'. If so write it off. This will ensure that you don't pay tax on income you didn't receive.