As the end of the financial year approaches, most Australians are looking to find a way to maximize their income tax returns. It is that time of the year when everyone is looking to reduce the tax bills, increase income tax returns and get in a better position for the next financial year. Being up to date with the current tax rates can minimize your tax every year, but tax planning is often left for the last minute. Thus, to maximize next year tax return, follow the tips below for personal income tax returns, business income tax returns or trustees of a SMSF.
Personal Income Tax Return
- Pay Your Expenses In Advance: If you pay your expenses in advance, you will surely bring the deduction forward into the next financial year.
- Buy Health Insurance: If you are a high-income earner, if you’d like to avoid the Medicare Levy Surcharge, the best option would be getting private health insurance. But remember, you need to hold the insurance for the entire year, otherwise the surcharge will be allocated.
- Delay The Income: If you can, try to hold off the income until the 30th of June in order to skip paying taxes this year. You can do this by going over deposit due dates or legally hold off the invoices until the 1st of July.
Business Income Tax Returns
- Pay Early: Paying your superannuation payments until July will give you a deduction for this financial year as opposed to the next financial year.
- Immediate Write Offs: Some businesses, if qualified, can write off certain business-related assets that cost less than $6,500. Check with tax office Australia to see if you are eligible.
- Structure: Consider your business structure, review it and see if it is the best organizational design for you at the moment.
Trustees Of Self-Managed Super Funds
- Avoid Unwanted Penalties: According to the tax office Australia, the contribution cap of your SMSF should not exceed the allowed amount. Everything over allowed contributions cap will make liable to penalty.
- Be Compatible: Make sure you have all tax forms for the self-managed super fund prepared as well as all required documents on the strategy and investments of your SMSF.
- Make Minimum Payments: To avoid high tax bills, make minimum payments into your SMSF. Check what is the minimum payment for your age bracket and reduce your tax and increase the refund on your income tax returns.