Tax time comes around every year, but with a little preparation, it doesn’t have to be stressful. Whether you’re lodging as an individual or managing business obligations, staying organised early on can help you avoid last-minute headaches and make the most of deductions you’re entitled to.
Here are a few helpful ways to prepare for tax time.
1. Keep your records up to date
It sounds simple, but good record-keeping is the foundation of a smooth tax process. Make sure you are keeping receipts, invoices and bank statements organised and accessible. For employees, this means keeping track of any work-related expenses you plan to claim. For business owners, this includes income records, expenses, GST reporting, payroll and super contributions.
Digital tools can help simplify this task. Many accounting software programs allow you to snap a photo of your receipt and categorise it straight away. If you’re unsure which tools might be right for you, it’s worth having a chat with a tax professional.
2. Understand what deductions you can claim
The Australian Tax Office (ATO) has specific guidelines around what you can and can’t claim. Common deductions for individuals include work-from-home expenses, uniforms, self-education and donations to registered charities.
If you run a business, you may be able to claim vehicle expenses, home office costs, insurance premiums and professional services. The rules can be a little complex, so getting clear on what applies to your situation can make a big difference to your return.
3. Don’t forget about super contributions
If you’re looking to grow your super and potentially reduce your tax at the same time, consider making a personal contribution before the end of the financial year. You may be able to claim a tax deduction on these contributions, provided you lodge a valid notice of intent with your super fund.
This can be a strategic way to support your retirement savings while making use of available tax offsets, but it’s important to understand the caps and timing requirements to avoid penalties.
4. Review your income and investments
If you receive income from multiple sources such as rental properties, investments or side work, now is a good time to check that all your income is accounted for. For investors, this includes dividends, capital gains and interest earned.
Speak with your accountant or tax agent about how best to manage these sources, and whether any strategies such as asset write-downs or timing sales might help you reduce your tax liability.
5. Book in early with your tax adviser
One of the best things you can do to prepare is speak with a trusted accountant before the end of the financial year. They can help you plan effectively, avoid common pitfalls and ensure you’re claiming everything you’re entitled to.
Many people wait until July to seek advice, but by that stage your options to influence the current year’s return are limited. A proactive discussion now can help you put the right strategies in place ahead of time.
Let us help you feel confident at tax time
At APS, our friendly tax and accounting team is here to guide you through the process. Whether you need help getting your paperwork in order or want to discuss smart ways to manage your income and deductions, we’re only a phone call away.
Get in touch today to book an appointment or ask us a question.
Written by APS Chief Financial Officer and head of APS Tax Accounting and Business Services, Stephen Fry.
Stephen is an accountant with over 13 years of professional expertise in the areas of taxation and accounting. Currently serving as Chief Financial Officer and head of APS Tax Accounting and Business Services, Stephen offers comprehensive guidance and ensures compliance in all tax-related matters. He has developed a specialised focus in areas such as self-managed superannuation funds, cryptocurrency taxation and leveraging software and technology to assist clients in streamlining their processes. Beyond his professional pursuits, Stephen cherishes quality time with his family and enjoys unwinding on the golf course. On the weekends he also enjoys following the AFL and watching British comedy television.