Call to Action – Reduce your tax in 2021
Tax Planning 2021
The end of the 2021 financial year is fast approaching – this is a crucial time for you to contact us to discuss the actions that can be taken before 30 June 2021 to help reduce your tax.
During this financial year, we had many clients reduce their PAYG Instalments due to the impacts of COVID-19, however if you received any JobKeeper payments, you might find that your profits have actually increased and there will be some tax that needs to be planned for.
For this financial year, we believe the priorities for you can include:
- Maximising your Superannuation Contributions up to the $25,000 contributions cap
- Bring forward any deductible expenses to this financial year
- Look at opportunities for deferral of taxable income
- Manage any Capital Gains that have triggered this year
- Utilise a family trust or a bucket company to cap your tax rates
The potential tax savings can be put to much better use, such as:
- Extra repayments on your home loan
- Top up your superannuation
- Take that long needed holiday
- Upgrade your car
- Maybe purchase another property
So, how can we help you?
There are a couple of incentives that the Federal Government threw our way during the Pandemic period of 2020. It is important that you consider these and let us work with you to determine which are most appropriate for you. Just to recap the options:
- Temporary full expensing of eligible assets / Instant Asset Write-off – this is a 100% deduction for business assets purchased and ready for use before 30 June 2021. Note that this is available on eligible assets that cost below $150,000, except for motor vehicles. New car purchases are limited to the depreciation cost limit of $59,136.
- Small Business Asset Pool – you can claim 100% of the balance of the pool as an instant deduction
- Temporary loss carry-back rules for eligible companies – claw back tax paid in previous income years (as far back as the 2018-2019 income year).
Tax planning is much more important now than it has ever been before. Even if you suffered a loss in the year 2020 and still recovering now – it is still important to maximise the tax effect of these. The tax concessions are available to any business with a turnover of less than $10m – so don’t miss out on these. Contact our team today and make an appointment to get this process started.
When was the last time that you had your structure reviewed? Is your business operating under the most appropriate and tax effective structure?
If we are to restructure you to take advantage of Tax Planning for 2021, then the this needs to be actioned now. Doing this in July will not help.
The concessional contributions cap for the current year is $25,000. If you didn’t pay this full amount in the previous financial year, and your balance was below $500,000, then you can also take advantage of the roll forward provision and pay the extra amount his year. Contact us to help you determine if you are eligible for this.