2020 Year End Tax Planning Guide
It’s been an extraordinary end to the 2020 financial year with many businesses being forced into hibernation due to COVID-19. The number one priority for most business owners right now is cash flow, so tax planning has never been more important. As your accountants, we believe our client brief includes helping you minimise your tax liability within the framework of the Australian taxation system and the purpose of this newsletter is to highlight some end of year tax planning opportunities. With June 30 fast approaching you need to act quickly, and we encourage you to schedule a meeting as soon as possible to assess your options and the steps you need to take well before the 30th June 2020.
Please note, the Federal Budget has been postponed until October 6, 2020 due to the effects of the coronavirus and the difficulty in formulating reliable economic and fiscal estimates.
You can download the full copy of the tax planning guide HERE
To assist you we have put together a list of strategies to consider and note:
- To maximise benefits for the current financial year, we suggest you prepare a preliminary calculation of your taxable income for the year ending June 30, 2020 to identify the size of your likely tax debt and establish if you have a tax 'problem'.
- Review all tax-deductible expenses and assessable income in the latest available figures to determine the possibility of pre-paying some expenses before June 30 or deferring some revenue until after July 1.
The following list of tax planning opportunities is certainly not exhaustive and depending on your circumstances (including your turnover and whether you are on a cash or accruals method of accounting), terms and conditions may apply to some of these tactics. If you would like to discuss your tax planning options we urge you to contact us today and most importantly, don't leave it until the last minute as some of these strategies require some time to implement.
To minimise your tax liability there are several general strategies to consider before
the end of the 2019/20 financial year including delaying income and bringing forward losses.
Other things that need to be addressed before the end of the financial year including motor vehicle log book, superannuation rates and
other issues for small business owners.
In addition to the tax planning opportunities, there are a number of reporting requirements regarding stock valuation options, writing off
bad debts, etc. for businesses to consider.
Before making any superannuation
contributions please discuss this with our office. There are strict eligibility requirements. Most importantly, regardless of the type of
contribution being made, transfers and deposits must clear before June 30.
Details of what's required to obtain the immediate write off for individual small business assets valued lower than $30,000 up to increased
threshold of $150,000 as from 12th March 2020 .
Disclaimer: This newsletter contains general information only and no responsibility can be accepted for errors, omissions or possible misleading statements. It is not designed to be a substitute for professional advice and does not take into account your individual circumstances. Therefore, no responsibility can be accepted for any action taken as a result of any information contained in this newsletter.