The end of financial year is rapidly approaching and it is important to start ensuring your business is ready. There are many strategies that can be implement to help minimise your tax and maximise your businesses efficiency before the 30th of June.
What can I do to minimise tax?
Defer your Income: Defer your Income by deferring your invoicing and receipting of income until after the 30th June 2017. This will be especially effective for companies under $2 million with the expectation the tax rate will reduce from 28.5% to 27.5%,
Instant Deduction for items less than $20,000: If you are a small business it is the last year you can receive an instant deduction for assets less than $20,000. If you are considering making any capital purchase under $20,000, bring the purchases forward before the end of the financial year.
Bring Forward Expenses: Purchase consumable items BEFORE 30 June 2017. These include marketing materials, consumables, stationery, printing, office and computer supplies. Spend the money now and get the deduction this year.
Prepay Expenses: Prepay expenses for up to 12 months: including insurance, interest and other subscriptions
Pay your employees Super: Pay the super guarantee due on the 28th of July before the 30th of June to obtain a tax deduction in the current financial year. Make sure to do this early to ensure any processing delays.
Make deductible super Contributions: Make additional super contributions up to the contributions cap before 30 June 2016.
Motor Vehicle Log Book: If you do a lot of driving for work, ensure that you have kept an accurate and complete Motor Vehicle Log Book for at least a 12-week period. The start date for the 12-week period must be on or before 30 June 2017. You should make a record of your odometer reading as at 30 June 2017, and keep all receipts/invoices for motor vehicle expenses.
Create a budget and update your business plan: If you would like to understand where your business is going and be able to track and measure your success having a good budget and a business plan is key. Being in business without these tools is like going on a trip without a map.
Write off Bad Debts: Review your Trade Debtors listing and write off all Bad Debts BEFORE 30 June 2017
Year End Stock Take: If applicable, you need to prepare a detailed Stock Take and/or Work in Progress listing as at 30 June 2017. Review your listing and write-off any obsolete or worthless stock items.
Trustee Resolutions Ensure that the Trustee Resolutions are prepared and signed BEFORE 30 June 2017 for all Discretionary (“Family”) Trusts. Please contact us for more information about these resolutions.