If you haven’t done so already, you need to get in touch with us to discuss your legitimate tax minimisation options. To get you in the mood, here are our top 5 tips when working with business clients. It’s one of our favourite ways to help. But remember, every business is different and there is more to managing the financial health of your business than reducing tax.
Tip 1: Write off any bad debts
No-one wants customers who don’t pay. So acting promptly when invoices are overdue is always the best approach. But if you have any bad debts that you know are irrecoverable, writing them off before June 30 is a wise approach to take. However, always check with us first.
Tip 2: Consider paying some expenses in advance
You need to be cautious about this tip to ensure you have the cash flow to support early payment. But if you can afford to do so, it can be advantageous to pay any invoices now that are due in July or August because it could reduce your taxable income for this financial year.
Beware of prepaying larger expenses such as rent as it needs to be a long-term strategy that you intend to follow for years to come.
Tip 3: Invest in equipment or vehicles
If you are intending to invest in equipment or vehicles for your business, you may be able to take advantage of the Instant Asset Write-off. Remember, there are eligibility requirements and the asset must be installed and ready for use by June 30 this year. Talk to us before you commit.
Tip 4: Understand your mixed-use deductible expenses
Some business expenses are clear cut but there may be others that combine business and personal use, such as your vehicle and mobile phone. You are entitled to claim the business use component as a tax deduction but to do so, you need to keep all receipts and have a log book or diary to record business use.
Tip 5: Keep your records up to date and organised
Invoicing promptly, quickly following up slow payers and recording receipts are all essential to ensure you are claiming all your eligible expenses and getting paid for your work. If you don’t feel you have a system you can manage, talk to us. We are always here to help you.
Waiting until June 30 to get your tax planning in place is too late!
Get in touch with us to arrange a time to start looking at your profits, expenses and cash flow because waiting until June 30 is too late.