The end of financial year is coming up quickly, but there’s still time to get your superannuation, investments, and tax in order.
Here are some strategies for you to consider during your end of financial year tax planning:
- Offset a capital gain – if you have sold an asset and realised a capital gain during the year, now is the time to consider selling a investment that has been poorly performing with a capital loss if that investment no longer suits your circumstances.
- Defer the sale of a profitable asset – if you are thinking of selling an investment in June consider deferring until July so you don’t crystallise a capital gain this financial year. This could possibly reduce your capital gains tax liability.
- Prepay interest on your investment loan – if you an investment loans for a property or investment portfolio you could consider prepaying 12 months interest on your investment loan. This will bring forward your tax deduction for the interest into this financial year.
- Obtain a depreciation report – if you own a rental property and haven’t done so already contact a quantity surveyor and have them prepare a depreciation report. Depending on the circumstances this will enable you to claim the decline in value of the assets in the rental property, and the building itself.
- Renew tax deductible subscriptions and memberships in June – if you have professional memberships or subscriptions required for work pay them in June for a tax deduction this financial year.
- Make a tax-deductible contribution to super – you can make contributions to a superannuation account including using catch-up contributions if you haven’t used the full $25,000 in the 2019 financial year. Check what concessional contributions have already been made in the 2019 and 2020 financial years and consider topping up your super for the difference and claiming a tax-deduction.
- Boost your partner’s super and reduce your tax – if you have a spouse whose total income (assessable income + reportable fringe benefits + reportable super contributions) is $37,000. After tax contributions to their superannuation account of up to $3,000 may provide you with a tax offset of up to $540 (18% of the contribution amount).
- Is your total income less than $53,364? – consider making an after-tax contribution to superannuation. A maximum government co-contribution of $500 is available and reduces by 3.33 cents per dollar over the total income threshold of $38,564. The matching rate for the co-contribution is 50%.
- Do you require equipment mainly used for work purposes? – there is an immediate tax deduction allowable for items that cost $300 or less subject to certain rules.
The above are just some of the strategies to consider and implement before the end of the financial year. As always check your individual eligibility with your tax adviser or accountant and consider whether these strategies are appropriate for your circumstances.
If you think you may benefit from any of the strategies mentioned in this article, please contact us or book a complimentary initial consultation using the form below.
