Let’s start with the urgent bit – if you haven’t lodged your tax return yet, pop it to the top of your to-do list. Nobody enjoys those late lodgement penalties!
Once that is off your plate, let’s talk Tax Planning.
Why Talk About Tax Planning now?
By March or April, we’ll have nine months of data for the current financial year – and that’s where things get interesting. This substantial chunk of financial information gives us a brilliant opportunity to make smart decisions about your tax position before the year ends. So let’s clean up any loose ends, get your books in order and understand what your business goals are for this year. Are you looking to buy some equipment or make other investments in your business?
Planning vs Avoidance
Tax planning isn’t about finding clever loopholes or aggressive schemes – those approaches often fall into tax avoidance territory, which can result in substantial penalties and a world of trouble with the ATO.
True tax planning is about making informed, strategic decisions about your business while working within the tax system. When we understand your expected tax position and align it with your business goals, we can look at legitimate ways to manage your tax obligations. For instance, this might involve timing of expenses, structuring business decisions efficiently, or taking advantage of available deductions and concessions that you’re entitled to.
Think of tax planning as part of your broader business strategy. Just as you plan for growth, cash flow, and staffing, your tax position needs the same strategic attention. By looking at your business plans alongside your projected tax position, we can work together to make decisions that benefit your business while ensuring you meet your tax obligations appropriately.
Why Nine Months of Data Makes a Difference
Having three-quarters of your yearly figures gives us solid ground to stand on. We can:
- Project your likely income for the full year with real confidence
- Spot any concerning trends before they become problems
- Calculate your potential tax liability with reasonable accuracy
- Put in place legitimate strategies to optimise your position
With nine months of data under our belt, we can look at several opportunities:
Review Your Business Structure
Is your current setup still the best fit? Whether you’re operating as a sole trader, partnership, or company, it’s worth reviewing if your structure aligns with your current situation and future plans. This also gives us time to make any changes you may require before the end of the financial year.
Timing is Everything
Understanding your position helps you make savvy decisions about:
- When to make major purchases
- The best time to raise invoices
- Maximising your super contributions
- Investing in new equipment or technology
Making the Most of Available Deductions
Now’s the perfect time to ensure you’re taking advantage of every legitimate deduction. This might include:
- Immediate asset write-offs for eligible purchases
- Research and development incentives
- Work-related expense claims
- Investment property deductions
Taking Action: Your Next Steps
The next few months will go quickly, but if you do the work now, by March/April we can:
- Take a thorough look at your current position
- Create reliable projections for the year-end
- Identify potential areas for tax-effective decisions
- Put strategies in place while there’s still time to make a difference
Book a Planning Session
Every business is unique, and what works brilliantly for one might not suit another. That’s why it’s worth booking a proper tax planning meeting. We can sit down together, look at your specific situation, and develop strategies that work for your business.
Good tax planning isn’t about finding loopholes – it’s about making informed decisions based on real data to ensure you’re in the best possible position come tax time. By starting now, we can ensure everything is in place to use the nine months of data effectively when the time comes, and make any necessary adjustments before the end of the financial year.
This article provides general guidance only. For advice specific to your situation, please get in touch to arrange a consultation.