2022 Tax Planning
It’s tax planning season! Don’t like paying too much tax? Then it’s time to get tax planning!
What is tax planning?
Basically, it’s accountant-speak for “what can we do before 30 June to save you giving your hard earned cash to the tax man”.
‘Tis the season to get planning
During April and May we’ll reach out and invite you to schedule in your tax planning to save you having to hand over anymore of your hard earned cash to the taxman than you have to.
Here are some hot tips on what to look for:
- Bad debts. Anything getting old & smelly in your receivables that should probably be written off? Now is the time.
- New business assets. Don’t go spending money just to get a tax deduction, that doesn’t make good economic sense. If you were going to spend the money anyway you may as well do it now and get the deduction this year.
- Superannuation. This has to be paid and receipted by the fund before 30 June to be deductible this year. So now is the time to review your obligations to employees and contractors plus consider whether or not you want to make some extra contributions for yourself.
- Loans. Did you borrow any company money this year? Talk to us to see how we can help.
- Trust distributions. Do you have a trust? Don’t forget to get your distribution resolution recorded before 30 June, Tax Planning is in important strategy in this regard.
- Prepaid expenses. Small businesses can claim up to 12 months of prepaid expenses in advance. So if you’re flush with cash you could look at prepaying some costs (e.g. rent) for the coming year and get the deduction this financial year.
One other thing to note in case you didn’t realise – the company tax rate remains at 25% for businesses turning over less than $50 million for this year & next. Whilst this doesn’t actually make any difference, at the end of the day once your profits are paid out as dividends (something commentators in the media don’t seem concerned with) but it does help out with present cashflow in the business.
Want to save on tax? Then get in touch now.