Tax Planning 2023: Maximizing Savings with Basic Strategies

Our library of helpful tips & tricks for managing your business and finances, provided to you by OneHQ Accounting.

As we approach the end of the financial year, it’s crucial for businesses and individuals to engage in effective tax planning. By implementing basic tax planning strategies, you can optimize your financial outcomes and maximize savings. At OneHQ Accounting, we understand the importance of proactive tax planning and are here to guide you through the process. In this blog, we will explore some basic tax planning ideas for 2023 that can help you minimize your tax liabilities and make the most of available deductions.

Prepay Expenses:

If you are a small business entity with an aggregated turnover of less than $50 million and sufficient cash flow, consider prepaying expenses. By prepaying for up to 12 months before June 30, 2023, you can bring forward deductions and reduce your taxable income for the current financial year.

Time Your Income Transactions:

In certain circumstances, you can strategically time your income transactions to optimize your tax position. Consider invoicing or contracting for asset sales after June 30, 2023, to defer income to the following financial year, thereby reducing your taxable income for the current year.

Consider Asset Acquisitions:

If your business requires new assets such as plant and equipment or non-structural assets, consider acquiring them before June 30, 2023. This allows you to claim an immediate deduction under the temporary expensing regime for businesses with an aggregated turnover of less than $50 million.

It’s important to note that for the deduction to be claimed, the assets must be received and ready for use before June 30, 2023.

Pay Employee Superannuation before June 30, 2023:

Superannuation payments made on behalf of employees can be claimed as a tax deduction in the financial year they are made, provided the Superannuation Guarantee (SG) requirements are met. Consider paying the June 2023 quarter super liabilities before June 30, taking into account the processing time required by clearing houses to ensure the contributions reach the super funds on time.

Consider Making Superannuation Contributions for Yourself:

Making additional concessional superannuation contributions can result in significant income tax savings, depending on your marginal tax rate. Review your current superannuation strategy and consult with your financial advisor to determine the optimal contribution amount based on your circumstances.

Consider Your Entity Structure:

Review your current structure to ensure it’s appropriate and complies with any ATO requirements. An entity restructure can help mitigate risks, provide asset protection, and potentially result in substantial tax savings. Our team at OneHQ Accounting can assess your specific situation and recommend the most advantageous structure for your business.

For more information on tax planning, please contact us today. Our experienced team is ready to assist you in navigating the complexities of tax planning and achieving your financial goals.

Need the help of a professional accountant? Contact One HQ Accounting for more information. We help clients all over Australia.
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