7 Handy Tax Tips For The End Of Financial Year
EOFY is here. So we’ve put together seven handy tips.
With the end of the financial year upon us, it’s time to make the most of any incentives available to your business, and consider any small steps you could make to help tax-time be a little less stressful.
To get you on the way, we’ve put together a few pointers for the end of FY2021.
1. Remember the new corporate tax rate
The corporate tax rate fell from 27.5% to 26% this year, and is set to fall to 25% for FY2022.
2. Make the most of instant write-offs
If your turnover is under $5 billion, you can instantly deduct the business portion of the cost of eligible depreciating assets. There’s no limit on the cost of the asset, but vehicles are excluded as they’re subject to special limits.
3. Keep up with changes to super
The compulsory rate
The compulsory super rate for all employees is rising from 9.5% to 10% on 1 July 2021, and is set to increase by 0.5% every year until FY2025, when it hits 12%.
The change means it’s important to think about your employment contracts. Depending on their wording, you may be able to reduce take-home pay to compensate. If you have no employment contracts, now’s a great time to set them up.
To claim a deduction, the funds must be in employees’ accounts by 30 June, so you should transfer payments by 24 June to make sure they get there on time.
The concessional limit has gone up
There’s a new maximum limit on concessional super contributions (rising from $25k to $27.5k), which will affect compulsory super, salary sacrifice and personal super contributions claimed as a tax deduction.
4. Sort single-touch payroll
By 1 July 2021, you’ll need to be registered for single-touch payroll. If you haven’t, penalties may apply, and you may also lose some related tax concessions. The easiest way to set up single touch payroll is through accounting software like Xero, MYOB or Quickbooks. If you use Xero, they also have a handy checklist for preparing your tax return.
5. Back up your claims
You should always keep proof of any expenses or deductions you claim. This year, the ATO will be looking very closely at deductions, especially those related to working from home. If you choose the simpler ‘short-cut’ method to claim working from home expenses (set at 80c per hour), you should keep a record of the actual amount of time you spent working from home.
6. Integrate your platforms
Tax time runs much more smoothly when all your systems, processes and platforms are integrated. With accounting integration, and automatic invoicing and record-keeping, the ShiftCare platform makes tax time simple.
7. Time your spending
You could pay less tax by paying upfront for expenses like software or office equipment before 1 July, making it a great time for upgrades.
💙 ShiftCare EOFY offer
Upgrade from a monthly plan, to an annual one, and enjoy up to 20% off.
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However large your team, we wish you a safe, seamless, and hassle-free EOFY.
This article was created in partnership with The Gild Group.