Below are 10 actions business owners need to take prior to 30 June to reduce their tax bill;
- Maximise your concessional superannuation contributions for the year i.e. $35,000 per annum where you are 59 years or over on 30 June 2013, otherwise the contribution is $25,000.
- Pay your employees Superannuation Guarantee Contribution (SGC) liability (which is due by 28 July) in June – you need to make sure the contribution is receipted by the superannuation funds prior by 30 June to qualify for the tax deduction.
- Write-off bad debts prior to 30 June and claim back the GST in your June 2014 BAS.
- Where your tax is prepared on an accruals basis, then accrue for and claim salary and wages owing but not paid at 30 June and any bonuses you intend to pay in July.
- Claim your 30 June workers compensation premium – this is an outright tax deduction and not subject to the pre-payment rules.
- Review the effective life of plant and equipment; where the written down value of plant and equipment is less than the market value then review the effective life of the plant & equipment and claim the write-down in the current year.
- Claim the write-down in the value for obsolete stock and write-off any scrapped stock.
- Where you have capital gains, crystallise any available capital losses. Take care to avoid wash sales where you sell and then buy back the same share to crystallise the loss.
- Prepare your 2014 tax plan and trust resolutions by 30 June 2014 to ensure you achieve the most effective distribution of taxable income to beneficiaries.
- Forecast your tax instalments and payments for 30 June 2014 and 30 June 2015 income tax year – where you have overpaid or expect to overpay then vary your tax installments down.
It is recommended you get appropriate tax advice to ensure you comply with the relevant tax legislation before you implement the proposed actions to reduce your tax bill.