With the end of the financial year looming, it pays to get your paperwork in order to make the most of deductions and benefits.
1. Fill out your car log book
If you use your car for work purposes, keep a 12-week log book. Keep all costs associated with the running of your car for the whole year, not just the log book period.
2. Super top-up
No matter your income level, superannuation is a great tax-reduction tool. You can contribute up to $30,000 to super ($35,000 for those aged over 49) at a concessional rate. If you earn under $35,454 take advantage of the superannuation co-contribution by putting in $1000, which the government will match by half. Free money! Also, if you earn less than $10,800 your spouse can put up to $3000 into your super fund and they will receive the full 18% spouse contribution rebate ($540).
3. Prepay and claim this year
Expecting a lower income next year? Bring forward your deductions into this tax year. Stocking up your home office with stationery, laptops and printers or prepaying subscriptions and interest on rental properties for up to 12 months are simple ways to reduce your income before June 30.
4. Clock-in working from home
More and more people these days work from home. Deductions are available for the work-related portion of home phone, internet, stationery, computer equipment and printers. Keep a diary of the times you work from home and claim a 45¢ per hour deduction for electricity.
5. Buy a new business asset
There’s no greater tax concession in recent years for small businesses than the $20,000 immediate write-off for new business assets. There is no limit to the amount of assets that you can purchase but beware you only get a percentage back and cash flow may suffer. The threshold effectively is $22,000 for those that are GST-registered as a 10% GST credit is claimed in quarterly business activity statements.