Year End Business Tax Tips – Act Now!

 

Year End Tax Tips

Top 10 for Business

• Ensure superannuation contributions are paid by Wednesday 27 June to ensure they are received by the superannuation funds and are deductible this year.
• Stock up on consumables and prepay subscriptions and rent. Note that businesses not in the “Small Business Regime” may only claim prepayments less than $1,000.
• If vehicles are due for servicing, do this before June 30.
• Provide staff bonuses as gift cards (gift cards less than $300 are tax and FBT free).
• Write off bad debts before 30 June.
• Attempt to sell slow moving and obsolete stock and when doing your stock take separate this stock to ensure it is costed at its recoverable value if this is less than cost.
• Postpone the sale of assets that will earn capital profits. If you already have capital profits, consider selling investments that have unrealised losses.
• Small businesses should delay purchasing new equipment if it costs greater than $1,000 and less than $6,500 until 1 July 2012. This will utilise the accelerated write-off available in the 2013 financial year.
• Small businesses should delay purchasing any motor vehicles until 1 July 2012 so as to utilise the accelerated write-off of $5,000 available in the 2013 financial year.
• Make the most of the $50,000 superannuation contribution limit for those aged 50 (as 2012 is the last year this will be available) and over or $25,000 for those under 50.

Top 10 for Individuals

• Consider prepaying your 2013 Private Health Insurance before 30 June if you are affected by the means testing of the 30% rebate. Some health funds are accepting prepayments of up to 18 months and the savings are likely to be around $2,000 for those people who will lose the rebate in full.
• Consider prepaying interest on geared investments, consumables and recurring bills
• If you are eligible, make a tax deductible superannuation contribution. Contributions caps apply and tax deductibility is subject to eligibility requirements (see below for limits).
• Make tax deductible donations to charity.
• If you are considering selling capital assets in June, consider your Capital Gains Tax position and think about the possibility of selling in July to defer the tax payable. If you have made a capital gain during the year and have capital losses on listed shares, consider the merits of selling those shares so that the loss may reduce the capital gain.
• Make an after tax super contribution to receive up to $1,000 in matched Government co-contributions, if eligible.
• If you are considering undertaking repairs to a rental property this year, think about undertaking the repairs in June. If you are invoiced in full for repairs during June, the repairs are generally deductible in the current year.
• Buy a replacement briefcase or other work related “tools of trade” less than $300 and claim the deduction this year.
• Start a motor vehicle logbook prior to 30 June 2012 if you have done a lot of travel for work in the 2012 financial year or if you have not maintained one for more than five years.
• Consider obtaining Private Health Insurance to avoid the Medicare Levy Surcharge in 2013 financial year. If you have turned 31 this financial year then you must also take out Private Health Insurance by 30 June to avoid higher premiums.