Your End of Financial Year Tax Guide

Written by Ray Phung

Getting the information together for your tax return can be a daunting process. It is hard to know what information to include and what not to include and how to achieve the best tax outcome for that financial year.

To help you navigate this process, we will outline the items you need to consider when preparing for tax time.

What is income?

Income can come in many forms. This includes:

  • Salary & wages

  • Business Income through operating as a sole trader

  • Lump sum payments or eligible termination payments

  • Dividends, distributions & interest

  • Rental property income

  • Foreign income

  • Capital gains from the sale of an investment such as property, shares, etc.

What deductions am I eligible to claim?

We all incur expenses to earn income. But how do we know what we can and what we can’t claim. Common claimable deductions include:

  • Work-related expenses such as car, travel, dry-cleaning expenses, tools & equipment, etc.

  • Home office or working from home costs

  • Self-education and professional development fees

  • Subscriptions & memberships

  • Professional fees such as accounting, financial advice or legal fees

  • Investment expenses

  • Rental property expenses

  • Donations

  • Personal superannuation contributions

Strategies to minimise your tax liability:

  • Review whether it is worthwhile to have private health insurance as this impacts whether you pay the Medicare Levy and its surcharge.

  • Consider making repayments on your outstanding HELP debt.

  • Ordering a tax depreciation schedule to outline the deductions available to you for your rental.

  • Keeping track of all outgoings on your rental including renovations, purchase of depreciable items such as an air conditioner, solar panels, etc.

  • Review the position of your investment portfolio and think about offsetting capital gains with losses from poorly performing investments.

  • Explore prepaying rent and investment loan interest.

  • Boost your superannuation savings whilst being mindful of contribution caps and timing.

The End of Financial Year presents an opportunity to reassess your finances and, more importantly, plan for the future. By identifying what your income is and what deductions you are eligible to claim coupled with proactive forward planning, you can significantly reduce your tax liability. It is also important to get professional advice to help you navigate some of the complexities of tax. Here at Salt Financial Group, our accounting team can assist you with all your tax needs and help prepare you for your upcoming tax obligations.

Jenni Anderson