Regardless of whether you are an individual employee, a business owner, a freelancer, or a side-gigger, there are plenty of things you can do to help reduce the amount of what you have to give to the ATO at tax time.
Here are some tips to help enable you to get the most out of your tax refund and reduce your tax bill.
Record Your Work-Related Expenses
Australian taxpayers must be ruthless when it comes to tracking all of your work-related expenses throughout the year and make sure you keep a record of your receipts.
It is suggested that you take photos of your receipts using apps such as Hubdoc that integrate with cloud-based accounting systems like Xero. These apps convert your receipts into data that is then uploaded straight into your accounting system.
Make Some Additional Contributions To Your Super
Additional payments that you make to your superannuation are taxed at 15 percent. However, taxpayers should take note of the cap on concessional contributions that is currently set at $27,500 per financial year.
Make Tax-Deductible Donations
You can show your support for a cause that’s important to you by making a tax-deductible donation to a charitable organisation.
In order for your donation to be listed as tax-deductible, it must be made to an organisation endorsed as a Deductible Gift Recipient (DGR) and must be a genuine gift.
Claim Investment Expenses
Make sure you claim investment expenses and your investment loss from the prior year, as this can be carried forward to offset future gain.
Use A Quantity Surveyor
By choosing to use a quantity surveyor to prepare a depreciation schedule for your rental property, you can ensure depreciation is captured and included in your tax return.
A tax depreciation schedule is 100 percent tax-deductible. This means you can claim the fee charged by the quantity surveyor as part of your tax return.
Pay Your Interest On Time
It is super important to make sure that all of your loan repayments are made on time.
Utilise the Capital Gains Discount
There is a 50 percent discount on capital gains that can be used for assets you have held for at least one year, including cryptocurrencies.
For Australians who are investing in cryptocurrency, if you’ve held the cryptocurrency for a duration of over 12 months, you may be eligible to discount your capital gain by 50 percent.
Structure Your Assets
Australian taxpayers should also explore the use of different structures, which could include a family trust, to better manage your assets and distribution of income.
Bring Forward Future Expenses
If your cash flow is strong, it might be a good idea to bring forward expenditure that you would otherwise have to outlay in the months following the 30th of June. By bringing this expenditure forward a month or two, you effectively get a year’s tax benefit because you’re saving tax now rather than in twelve months’ time.
Hold Private Health Insurance
Having private health insurance coverage means you avoid having to pay the Medicare levy surcharge.
Remember these useful tips to reduce your tax bill.