Pre 30 June planning
The end of financial year is fast approaching so below we highlight some tax planning opportunities which may result in a number of tax savings.
- Conduct any rental property inspections prior to 30 June. After 1 July 2017 expenses incurred by an individual travelling to inspect, maintain, or collect rent on a rental property will no longer be deductible. Investors will still be allowed to engage third parties such as real estate agents to carry out these management services on their behalf.
- Gifts and Donations to approved deductible gift recipients before 30 June can be used to offset taxable income.
- An immediate deduction is available for assets that cost $300 or less that are used predominantly to produce assessable income by non-business taxpayers.
- If you use a motor vehicle for business purposes ensure you record your odometer reading as at 30 June 2017 and that you have a valid 12 week log book that is no more than 5 years old. It's not too late to start a log book now if you have not already done so. As long as the start date is prior to 30 June 2017 it can be used for the 2017 tax return.
- Consider pre-paying 12 months of expenses. For example professional body memberships, magazine subscriptions used in producing your assessable income or income protection insurance premiums can be paid prior to 30 June.
- If you have sold capital asset during the year, it is recommended that you contact your advisor to discuss the tax implication and options to minimise this.
- Accelerated depreciation deductions are available for small businesses on assets purchased and installed ready for use prior to 30 June 2017 costing up to $20,000. From 1 July 2017 the threshold reduces to assets costing up to $1,000.
- All outstanding debts should be reviewed. You should consider whether these items can be written off as bad debts prior to 30 June. If you have done everything in your power to seek payment of the debt from your customer without success, then you may be able to claim a tax deduction for the bad debt.
- Stock takes should be taken to determine the value of trading stock left on hand as at 30 June 2017. There are various methods of valuing stock which our office can discuss with you.
- Ensure superannuation contributions are paid prior to 30 June to ensure the deduction is claimable in the 2017 year. Superannuation is only deductible when paid.
- Review asset registers to determine equipment no longer held or in use. A deduction may be available on disposal of the asset.
If you have any questions about any of these opportunities, please contact your Goodwin Chivas & Co. representative.