Not sure what you can and can’t claim for work. Use our tax checklists as a guide as well as the ATO has some very good occupation specific guides here. Still confused or have a query? Speak to our office to help guide you.
The cap for claiming superannuation contributions is currently $25,000 per year. Should you go over this cap through either salary packaging more or simply your employer contributing too much super, this excess amount is now assessed back against your personal income and the additional tax from this is required to be paid. You are able to elect to have this money refunded back to you from your fund to enable you to pay this tax bill or pay the funds yourself. Talk to our office if you’ve received one of these notices and not sure of what is your next step with it.
Negative gearing is where you can use the losses from owning an investment property to offset your income. These losses, after deducting all of the interest, depreciation and other rental costs reduce your taxable income, creating a refund in your tax return. You can then use these refunds to either offset the out of pocket costs on the property or help pay down your own personal mortgage quicker.
Simple answer to this is NO. Whilst that should be the minimum we do for you, we can do much more for a client. Such as (but not limited to):
For a small business, cash is king. If you don’t have it, you can’t pay staff, suppliers or the ATO. Knowing when you have these payments to make along with when you will be receiving the cash to make these payments is essential for all business. Preparing a cashflow forecast can not only show you where your cash is going but also show you if you really can afford to buy that new machinery or put on a new staff member. Speak to our office if need to help in preparing these.
When asking most clients what their biggest asset is, they will say their house. It is actually you! Earning $50,000 a year for the next 20 years is $1 million, obviously having greater levels of income or longer to work will make this figure even higher. Funnily enough, stats show that more people in Australia insure their pets than they do themselves! Income protection insures you for a possible loss of this income. Speak to our office today to make sure you are covered today.
In simple terms, assets that cost more than $300 are deemed by the ATO to have an effective life of more than 1 year. Therefore, the ATO writes off the value of these over its deemed life. This is why that $1,500 laptop that you purchased for work will not be written off in the first year that you buy it, instead it will be written off over the next few years.
Saying that you want to pay off your home loan earlier is a goal but will it work? Probably not. Why not? There is no set time-frame and therefore no real idea of how you will get there. Saying I want to pay off my home loan in 10 years is a specific goal that you can then work directly towards. It will make you budget, give you a time-frame and hopefully then keep you accountable to this.
From a tax point of view, you should always pay off your private debts first, especially credit cards as these generally have the highest interest rate. You don’t receive a tax deduction for personal debt whilst you can for business or investment debt , thereby making the actual interest that you pay on this less.
Starting this week, we will be updating our blog fortnightly with quick tax tips or just general advice, that if followed, will help give you the greatest chance of minimising your tax but also maximising your overall financial position.
They will be quick, one minute reads that hopefully either reinforce what you are already doing or a call to action that may help you achieve your financial goals!