With the end of the tax year fast approaching, you might think it’s too late to optimise your tax return. However, even with only a few weeks left, there are still opportunities to maximise your tax refund for the year. Here are some key strategies to consider as we head towards June 30:
1. Prepay Some Expenses
Consider prepaying expenses that relate to the upcoming year, such as union fees, professional subscriptions, and annual insurance premiums. By paying these in advance, you can claim a tax deduction this year and accelerate your deduction benefits.
2. Gather Written Evidence
Ensure you have all necessary written evidence, including receipts, invoices, and bank or credit card statements, for every claim you intend to make. Proper documentation is crucial for substantiating your deductions.
3. Mobile Phone
If you’ve used your personal mobile phone for work purposes, you can claim a deduction for the business-related usage. Keep your phone bills and maintain a log of business vs. personal use over a four-week period, which you can then apply to the entire year. Remember, you can’t claim a separate mobile phone deduction if you’ve claimed the 67 cents/hour fixed rate for working from home.
4. Offset Capital Gains Against Capital Losses
If you’ve made a capital gain from disposing of shares or other investments, consider selling assets that are currently at a loss. The resulting capital losses can offset your capital gains, reducing your tax liability. Be cautious of “wash sales,” where you sell an asset before the end of the tax year and repurchase a substantially identical asset immediately after, as the ATO may apply anti-avoidance provisions and penalties.
5. Running Your Own Business?
Take advantage of the “instant asset write-off” measure if your business has a turnover of less than $10 million. This allows you to claim an immediate tax deduction for capital purchases under $20,000, including tech items, tools, office furniture, and even second-hand vehicles. Ensure the asset is used or available for use in your business by June 30, 2024, to claim the deduction this tax year.
6. Home Office
If you work from home, you can claim deductions for home office expenses such as heating, cooling, lighting, cleaning, and depreciation of office furniture and equipment. Items under $300 can be written off immediately. Alternatively, use the ATO’s 67 cents per hour fixed rate to claim a simple, all-inclusive amount for home office expenses. Ensure you have records of your working hours and one item of substantiation for each claim.
7. Charitable Donations
Make last-minute charitable donations to registered charities and claim deductions for donations over $2. Ensure you have a receipt for each donation to substantiate your claim.
8. Car Expenses
If you use the log-book method, ensure your log-book is up to date and you have all the necessary receipts and records for your claim. For the cents per kilometre method, maintain a record of all work-related journeys during the year.
9. Make a Tax Deductible Super Contribution
Consider making a personal contribution to your super fund if you have spare cash. Provided your total contributions, including employer contributions, don’t exceed $27,500, you can claim a tax deduction for your personal contribution. The payment must be made by June 30, and you need to notify your super fund of the contribution by the time you lodge your tax return.
10. Seek Expert Help
Speak to us! We can identify exactly what you need to do to get into shape for the 2024 tax season and maximise your deductions.
These strategies can help you make the most of your tax refund as we approach the EOFY. Be proactive and ensure you’re well-prepared to maximise your deductions and benefit from available tax reliefs.
Give the experienced team at TTO a call on 08 8211 9426