Now is a good time to consider the recent legislative changes, especially those to personal tax rates in 2017/2018 and how they may relate to you. This year’s Federal Budget announcement included staged tax relief for low and middle income earners, subsequently creating new tax planning opportunities for this particular demographic.

Also, if you’re a small business entity, you will have already taken special notice of the 27.5% lower tax rate change when lodging your 2017 tax return. With the turnover threshold for access to the reduced company tax rate increasing to $25 million, plus a likely definition change regarding eligibility, many more companies will stand to benefit.

Please note that the content provided below is intended to provide a general guide to the subject matter. Specialist advice should be sought in relation to your specific circumstances to ensure the best outcome.

Here are some tax planning initiatives and year end considerations which may help you:

Individuals

  • Now is a great time to prepay any non-business / work-related and investment expenses.
  • Beginning and completing repairs to any depreciating assets (such as rental properties) before the new financial year will more effectively manage tax implications.
  • If you are running a business at a loss, perhaps consider whether any of the non-commercial loss tests can be satisfied to offset the loss against your other income.
  • Farm Management Deposits – now is a good time to consider whether deposits or withdrawals should be made before year end.
  • Have you made any capital gains as an individual this year? If so, planning may be required to manage this.

Businesses including Small Business Entities

  • Writing off any bad debts is a great start!
  • We suggest scrapping any depreciating assets no longer in use (such as motor vehicles/phones/laptops that are no longer required).
  • Paying superannuation before 30 June means you will claim the deduction in 2017/2018.
  • For small business entities:
  • You can bring forward your acquisition of assets to the current year to access the $20,000 immediate write off concession that has been extended for the 2017/18 financial year.
  • Establishing a prepayment schedule of up to 12 months can be beneficial.
  • Trust distribution resolutions are required by 30 June or earlier dependant on the requirements of the deed.
  • Company tax rate reduction to 27.5% for small business entities. Additionally, many more companies will be eligible based on the increase in turnover threshold to $25m per annum.
  • Have the minimum loan repayments been satisfied for shareholders and associates? In you’re unsure, now is the time to talk to us about your options and obligations.

SMSFs and Superannuation end of year checklist

  • If you haven’t already, now is the time to begin compiling all your relevant end of financial year documentation.
  • Making additional superannuation contributions up to the maximum concessional contribution limits could be worth considering.
  • Ensure your SMSF has met minimum pension requirements.
  • By now you should have already reviewed or be reviewing your investment strategy to ensure it is up to date.
  • Asset valuations for your SMSF should be completed by the end of financial year.
  • If your SMSF or Super fund has made any capital gains this year, appropriate management techniques should be considered now.

West Carr & Harvey tax return checklist – As tax time approaches and you begin compiling your relevant information for us, you may find one of our tax return checklists helpful. If necessary, this checklist can also be tailored to your individual needs depending on your requirements. If you would like a checklist sent to you, or you are unsure about what you need to provide, please contact us prior to compiling your details for your 2017-2018 tax return.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.