1. Keeping a car log book could increase your refund by thousands
If you use your car for work purposes and keep a log book for 12 weeks then the deductions can be in the thousands. Make sure that you keep all costs associated with the running of your car (such as petrol, insurance, registration, servicing and lease payments) for the whole year, not just the period that you kept the log book. Remember that the ATO motto is no receipt = no deduction so you could be costing yourself $$$ by not keeping those dockets!
2. Take advantage of the Government’s free money service known as the “Super co-contribution”
It is surprising how few people actually take advantage of some free money from the Government. If your income is under $31,920 and you contribute $1,000 post tax into super the government will match it 50 cents in the dollar. Whilst this incentive gradually phases out above this figure at $46,920, it’s free money! Also, if you earn less than $10,800 then your spouse can put up to $3,000 into your super fund and they will receive an 18% rebate ($540) on tax via the spouse super contribution rebate.
3. Minimise capital gains tax (CGT) by deferring sale or offsetting losses against gains already made
The share market has had a roller coaster year in 2012/13. If you made a nice capital gain or two earlier in the year then you can reduce CGT by selling any non-performing shares that you may be currently holding. Any unrealised gains should be sold after 1 July to defer tax for another year. And remember that if you hold shares for more than 12 months you reduce CGT by half.
4. Build your nest egg quicker by paying 15% rather than 46.5% by salary sacrificing into super
Salary sacrificing into superannuation is one of the best, and legitimate, ways to minimise your income tax bill. You can contribute up to $25,000 per year into super which is only taxed at 15 per cent instead of your marginal tax rate (potentially 46.5 per cent). There are not many pay packets left to do it this tax year, so keep in mind to start putting extra away when 1 July arrives.
5. Income expected to be lower next year? Bring some 2013/14 expenses forward into this year
If you are expecting that you will have a lower income next year – due to factors such as maternity leave, redundancy, a smaller bonus or perhaps cutbacks to overtime – then why not try to bring forward your deductions into this tax year. Stocking up your home office with stationery, laptops and printers or prepaying subscriptions and interest for up to 12 months in advance are just some of the simple ways to reduce your income before 30 June this year.
6. Claim a deduction for the costs you incur in running your home-office
More and more people these days are doing work at home but not many are aware that they can claim a deduction for costs you incur in running your home office, even if a room is not set aside solely for work-related purposes. Deductions are available for the work-related portion of home telephone, internet, stationery, computer equipment and printers. Keep a diary of your time that you work from home and claim a 34 cents per hour deduction for electricity, gas and depreciation of home-based furniture.
7. Keep your receipts
With the ATO continuing to ramp up their audit activity yet again it is important that you keep your receipts. The ATO motto is no receipt = no deduction so you could be costing yourself $$$ by not keeping those dockets!
8. Get a great accountant
Avoid paying too much in tax or leaving yourself to a visit from the taxman. Great accountants are like surveyors … they know where the boundaries are. And their fees are tax deductible!
This information is of a general nature only and does not constitute professional advice. Please contact us firstname.lastname@example.org for a professional advice in relation to your particular circumstances before acting.