As we approach 30 June (end of financial year), now is the time that you may be looking to optimise your tax deductions which can help to maximise your tax savings.
To assist you with this, please read the following blog which will give you an indication on some things you may be able to take advantage of as well as some things to steer clear from.
BUSINESSES
Daily Expenses
Deductions can be claimed for ‘everyday’ business costs i.e. rental costs, stationery/office supplies and maintenance costs.
Wages
Settling things such as salaries and wage costs (plus super contributions) prior to 30 June can maximise your deductions.
Business Assets
Take advantage of the instant asset write-off on any eligible purchases.
INVESTORS
Interest on Investment Loans
Interest charged on loans against an investment property can be deducted including fees that relate to servicing the loan.
Maintenance Costs
Any repairs or maintenance costs associated with investment properties are deductible.
Property Management Costs
If you have a company managing your investment property on your behalf you can deduct costs such as agent fees, advertising etc.
INDIVIDUALS
Work
Tools and equipment used specifically for work can be claimed outright if they are under $300, anything over $300 needs to be depreciated. Remember to keep any receipts.
Education and Study
Study and education costs that grow your skillset and can be applied to your current job role can be claimed. (Course Fees, Stationery, Textbooks etc)
Charity and Donations
If you have donated to a registered charity then this expense is tax deductible (if over $2).
WHERE TO PROCEED WITH CAUTION
There are many ‘red flags’ the ATO is always on the look out for when it comes to deductions, we strongly encourage that you have a good understanding of what is a ‘no no’ when claiming deductions.
Expenses that bridge the border of personal expenses when you are in business is something you need to be careful of. You should have receipts and documents to back up any business-related claims. Vehicles can be a cost you need to be very careful of as these have very strict guidelines if you are claiming them for business use.
Also avoid claiming for deductions that you simply do not qualify for. If you aren’t sure of what claims are suitable the ATO has a very clear list of allowable deductions, an accountant will also be able to advise you properly and ensure you remain compliant with the ATO.
OUR BEST ADVICE
Be prepared and start your tax planning early ahead of the EOFY. For tailored advice and assistance when it comes to deductions please get in touch with our team.