End of Financial Year 2016: Get ready
June 2016
End of financial year always seems to sneak up on business owners and following the 2016 Federal Budget, there are quite a few reasons for small business owners to rethink their tax planning
The basic housekeeping
There are some basic housekeeping requirements at this time of year, including:
- Writing off damaged or obsolete stock
- Writing off bad debts;
- Scrapping any out-of-date or obsolete plant and writing off your asset register;
- Making loan repayments to satisfy Division 7A loan agreement;
- Finalising any inter-entity management charges;
- Review your deductions; and
- Take advantage of timing benefits and permanent savings.
Comply with Division 7A
Check your cash flow
As the business mantra goes, maximise your income and keep your expenses low, however at tax time, there are good reasons to consider reversing that mantra.
Immediate asset write-off
Many businesses with revenues of less than $2 million took advantage of the immediate deduction of purchases under $20,000, which was announced in the 2015 Federal Budget. It's a deduction worth taking advantage of if you business has the cash flow to do so.
What else can you do?
There may be other ways to time your expenses and income, so we'd suggest you talk to your accountant before the financial year ends so that you can make sure your tax strategy is taking into account the new taxation measures announced during the Federal Budget.
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Disclaimer
This article is provided for information purposes only and correct at the time of publication. It should not be used in place of advice from your accountant. Please contact us on 02 9957 4033 to discuss your specific circumstances.
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