Maximise Your Savings: 2023 Tax Planning Strategies

This End of Financial Year Tax Planning Guide highlights key points and strategies to help individuals and businesses optimise their tax planning. It covers various areas, including deductions, exemptions, and other important considerations for the upcoming financial year.

Key Points

Individual Tax Planning:

• Review your income and deductions to ensure accuracy and identify potential tax-saving opportunities.
• Utilise available tax offsets and rebates to reduce your taxable income.
• Consider prepaying expenses or deferring income to manage your tax liability effectively.

Some areas to pay special consideration to this EOFY include:

Reducing impacts from Capital Gains Tax

Assess your capital gains and losses to determine potential tax liabilities and plan your asset disposals strategically to minimise CGT obligations.

Deducting Working from Home Expenses 

You can continue to claim 67 cents per hour worked from home to cover deductible running expenses. However, certain record-keeping requirements still apply. Having a dedicated workspace at home is not mandatory, and you can also calculate the actual work-related portion of all running costs as usual.

Super Saver Scheme

First-time homebuyers can contribute up to $15,000 annually through salary sacrifice, while ensuring they don't exceed the $27,500 concessional contributions limit. This allows them to save for a deposit on their first home.

Up to $50,000 can be saved in this manner in total over the years. If the buyer's partner is also a first-time homebuyer, they can contribute a combined maximum of $100,000 ($50,000 each). Withdrawn funds are subject to income tax at the individual's marginal rate, with a 30% rebate.

You should also evaluate the eligibility and benefits of various other superannuation contribution types.

Business Tax Planning:

• Evaluate your business structure and assess if any changes could provide tax advantages.
• Review and reconcile your financial records to accurately calculate your taxable income.
• Utilise instant asset write-off provisions and other incentives to invest in business assets.
• Be mindful of the ATO’s compliance program, that is zeroing in on family trusts and how income is appointed through them. Consult your trusted advisor to ensure you are aware of the latest rulings which stipulate which arrangements will be subjected to further review.

Deductions, Rebates & Temporary Full Expensing:

• Familiarise yourself with eligible deductions and rebates applicable to your situation.
• On the 30^th of June 2023, temporary full expensing of depreciating assets will end. Businesses that have a collective turnover below $5 billion have the opportunity to fully deduct the expenses incurred on eligible depreciating assets. However, it is important to ensure that these assets are installed and prepared for use no later than June 30, 2023.
• Seek advice on complex deductions, such as those related to properties or investments.

Record-Keeping and Documentation:

• Maintain proper documentation and records to support your tax claims.
• Utilise digital tools and software for efficient record-keeping.
• Understand the record retention requirements set by the tax authorities.

Tax time presents an opportunity for growth and financial optimisation, thanks to the dynamic nature of tax laws and compliance requirements. This article aims to empower you with valuable tax-saving ideas for the end of the financial year, enabling you to enhance your business or personal finances.

Remember, seeking guidance from a knowledgeable tax professional or accountant is crucial to customise these recommendations according to your unique circumstances, ensuring both maximised benefits and compliance with the latest regulations.