2014 Tax Planning Strategies

 

The end of the 2013/14 financial year is almost here, so now's the time to review what strategies you can use to minimise your tax.


#1 | Concessional Superannuation Cap

The concessional (“tax deductible”) superannuation cap for 2014 is $25,000 per year for persons under 60 as at 30/6/14, and $35,000 for persons age 60 to 75. Do not go over this limit or you will pay more tax!
Note that employer super guarantee contributions are included in these caps. Where a contribution is made that exceeds these limits, the excess is taxed to the fund member's account at an effective rate of 46.5%.

 

#2 | Employee Superannuation Payments

To claim a tax deduction in the 2014 financial year, you need to ensure that your employee superannuation payments have CLEARED your business bank account by 30 June 2014.
Also, check that your payroll system is now paying the required 9.25% rate (up from 9%) from 1 July 2013.

 

#3 | Defer Income

Subject to cashflow requirements, defer issuing invoices until after 30 June 2014. This won’t apply to some small businesses who elect to pay tax when it is received, rather than invoiced.

 

#4 | Bring Forward Expenses

Bring forward certain expenses that are planned to occur after 30 June 2014. For example, repairs & maintenance and consumable expenditure.

 

#5 | Year End Stock Take / Work in Progress

If applicable, you need to prepare a detailed Stock Take and/or Work in Progress listing as at 30 June 2014. Review your listing and write-off any obsolete or worthless stock items.

 

#6 | Small Business Concessions - Prepayments

“Small Business Concession” taxpayers can make prepayments (up to 12 months) on expenses (e.g. Loan Interest, Rent, subscriptions) BEFORE 30 June 2014 and obtain a full tax deduction in the 2014 financial year.

 

#7 | Private Company (“Division 7A”) Loans

Business owners who have borrowed funds from their company must ensure that the appropriate principal and interest repayments are made by 30 June 2014. We can assist with implementing the appropriate strategy.

 

#8 | Personal Remuneration Structure

Review your personal remuneration structure to ensure it is structured effectively. This includes a review of your salary, dividends, directors fees, superannuation and salary sacrifice opportunities.

 

#9 | Trustee Resolutions

Ensure that the Trustee Resolutions are prepared and signed BEFORE 30 June 2014 for all Discretionary (“Family”) Trusts. Please see us for more information about these resolutions.

 

#10 | Other Strategies

  • Capital Gains; If you have made a capital gain for the year, you should consider selling any non-performing investments you hold before 30 June to crystallise a capital loss and reduce or even eliminate any potential capital gains tax liability
  • Property Depreciation; If you have an investment property, a Property Depreciation Report (prepared by a Quantity Surveyor) will allow you to claim depreciation and capital works deductions on capital items within the property.
  • Motor Vehicle Log Book; Ensure that you have kept an accurate and complete Motor Vehicle Log Book for at least a 12-week period. The start date for the 12-week period must be on or before 30 June 2014.

 

Want to know more? Give us a call.

tax2.jpgPlease note... The information in this document is of a general nature and does not take into account your individual needs and objectives. Please do not act on any information in this document before seeking advice from a qualified Accountant and a licensed Financial Planner.

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