It's Tax Time Now!

By Tina Zawila

When you read the title of this article, you may have thought, “it’s only May!”, however, this is not a typo. It really is time to talk tax NOW, in May.

You save tax, or maximize your refund NOW, by the actions you take before 30 June, not when you see your accountant after the financial year is over.

This is the time of the year to assess where you are to date and what actions you can do to improve your position. If you are in business there are tax saving strategies that s are simple and somewhat obvious – such as deferring income and bringing forward expenses, however, every year there are also some specific strategies and windows of opportunity.

This year, there are two legislative changes which take effect from 1 July 2017, which means that you must act before 30 June 2017 to access the tax advantages that these two changes will remove.

1. If you are aged under 50 you can currently contribute up to $30,000 to superannuation and claim a tax deduction for the contributions, if you are over 50 that amount increases to $35,000. However, from 1 July 2017 this concessional contribution cap falls to $25,000 for everyone. Therefore, the 2016/17 year is the last year where you can contribute an ‘extra’ $5,000-$10,000 into super and claim a tax deduction. 
2. If you are a small business owner you may be aware that you can currently claim an immediate tax deduction for assets costing less than $20,000. This accelerated deduction is not available post 1 July 2017, therefore, this year is your last chance to claim an immediate deduction for assets (costing less than $20,000). After 1 July 2017 you will only be able to claim the cost of the asset over several years (depreciation). 

Of course, this is general advice only and you should seek specific advice tailored to your own circumstances before taking any action. DIY Tax Planning can be worse that no Tax Planning at all. Call Sothertons Gladstone on 4972 1300.