Tax Saving Strategies prior to 1st July 2019
Minimising Tax for Small Business Entity (SBE) taxpayers (turnover under $10m)
1. Accelerating Asset expenditure
All SBE taxpayers can choose to write-off depreciable assets costing less than $30,000. Also, assets costing $30,000 or more are allocated to an SBE general pool and depreciated at 15% (which is half the full rate of 30%) in their first year. Note that the asset must be installed and ready for use by 30 June 2019 to be deductible.
2. Prepayment strategies
SBE taxpayers making prepayments before 1 July 2018 can choose to claim a full deduction in the year of payment where they cover a period of no more than 12 months (ending before 1 July 2020).
The kinds of expenses that may be prepaid include:
- Rent on business premises or equipment.
- Lease payments on business items such as cars and office equipment.
- Interest – check with your financier to determine if it’s possible to prepay up to 12 months interest in advance.
- Business trips.
- Training courses that run on or after 1 July 2019.
- Business subscriptions.
3. Employee Superannuation – Pay before 30/06/2019
Employee Superannuation accrued for the 4th quarter of the 2018/2019 Tax year isn’t due until the 28th July 2019. But Super is only deductible once paid, not accrued. So by paying 4 weeks earlier you get the tax benefit 12 months earlier.
This is some of the information we will need you to bring to help us prepare your income tax return:
- Stocktake details as at 30 June, unless you think the stock hasn’t changed by more than $5000 since last year.
- Debtors listing (including a list of bad debts written off) as at 30 June. Note: In order to claim a deduction, the debt must be written off on in your accounting system on or before 30 June.
- Creditors listing as at 30 June.
- Read more
Small business entity (‘SBE’) (i.e. taxpayers with turnover less than... more
June 20, 2019