As the end of the financial year approaches, small business owners across Australia have an opportunity to make smart decisions that could significantly improve their tax position. Effective tax planning doesn’t just minimise what you owe — it can also create long-term benefits for cash flow, investment, and overall financial health.
1. Review and maximise deductions: Make sure you're claiming all eligible expenses. This includes office supplies, travel costs, equipment depreciation, and professional services. If you're considering buying new business assets, doing so before 30 June may allow you to take advantage of immediate deductions under the temporary full expensing scheme.88
2. Defer income: If your business cash flow allows it, consider delaying the invoicing of some income until after 1 July. This can help reduce your taxable income in the current year. However, this strategy should be used carefully, particularly if your business operates on a cash basis or expects income changes in the coming year.
3. Contribute to superannuation: Employer contributions to employee super funds are tax deductible, and personal contributions may be as well. Making additional contributions before the EOFY not only helps reduce your taxable income but also supports long-term retirement planning.
4. Write off bad debts: If you’ve got outstanding invoices that are unlikely to be paid, now is the time to write them off. Document your efforts to recover the amounts, and ensure the debts were previously reported as income. Writing off bad debts can reduce your taxable income and reflect a more accurate financial position.
5. Work With Trusted Advisors: The best tax strategies are tailored to your specific business structure and goals. Experienced accountants in Melbourne can help you identify opportunities, stay compliant, and plan ahead for sustainable growth. They can also keep you updated on legislative changes that could impact your obligations or entitlements.
Proper planning in the weeks leading up to EOFY can result in significant savings and smoother financial management in the year ahead. It's never too early to start reviewing your options and taking action — your future self will thank you.
