We often hear how important it is for businesses of all sizes to minimise tax, but how can you achieve a smaller tax bill? Here at Your Tax Mate, we’re focused on helping you achieve greater profitability and business growth by implementing smart strategies which are designed to minimise tax and reduce your taxable income.
Here’s just 5 ways our experienced accountants can help you reduce your tax bill:
CONCESSIONAL SUPER CONTRIBUTIONS
Did you know that concessional super contributions are taxed at just 15% once they enter your or your partner’s super fund? It’s a smart move to consider concessional super contributions so you can lower your taxable income. Why not consider personal deductible contributions or salary sacrificing so you can reap the rewards at tax time?
MORTGAGE OFFSET ACCOUNT
This solution is ideal for homeowners who want to pay less tax. Using a mortgage offset account allows you to add money to your mortgage, as you would a regular savings account, yet it provides major tax advantages. Not only does it allow borrowers to pay off their owner-occupied properties sooner, the mortgage offset account reduces the interest on the outstanding mortgage. You also have the flexibility of being able to access your money, when required.
If you want to lower your taxable income, an ideal solution is to make charitable donations to a registered charity. Donate sums greater than $2 and make sure you retain the receipts. Upon tax time, your donations will be collated with the total added into the charity donations section of your tax return. Not only are donations effectively reducing your taxable income, you’re helping a charity – so it’s a win-win situation.
ACCURATE RECORD KEEPING
If you want to claim every possible deduction, then you’ll have to ensure that you have the paperwork to back it up. The simplest way to achieve this is to retain all your receipts in an organised and accessible manner. In our previous blog, we suggest that you categorise your receipts in terms of expense type, so you can quickly add up the totals for your tax agent. You can also utilise accounting software and the ATO app, which can help you keep track of your expenses with digital copies. Don’t risk drowning in a sea of paper receipts; get tech savvy and ensure that you can claim all your deductions.
PRIVATE HEALTH INSURANCE
To avoid the Medicare Levy Surcharge, it’s a good idea to consider the benefits of choosing private health insurance. The Medicare Levy Surcharge can potentially cost you extra in tax — if you’re in a specific pay bracket. The income threshold is $90,000 for singles and $180,000 for single parents, couples and families. The threshold increases for each Medicare Levy Surcharge dependent child, after your first born. This surcharge can be an additional 1-1.5% on your annual income. Discuss the pros and cons of private health insurance with your accountant. We can help you decide if this option can work for your unique circumstances.
Your Tax Mate can help you minimise tax with an array of proven strategies. Why not connect with our accountants to find out more about minimising your taxable income? Our Ipswich team are conveniently located at Goodna, so call us today on 07 3818 2442.