Get ahead at tax time

The end of financial year is often the only time many Queenslanders put time and effort into minimising the amount of tax they pay.

However, Manager Bank to Member Initiatives Eszter Cathcart said that once the financial year was over it was often too late to maximise tax-saving opportunities.

“Many strategies that decrease the amount of tax you pay must be completed before the end of the financial year,” Ms Cathcart said.

“The good news is that there’s still time to reduce your tax for the 2021 financial year and set you up for the coming year.”

Pre-pay expenses

Ms Cathcart said paying for work-related expenses, such as home-office equipment, tools and education courses, before 30 June could be an effective way to reduce your taxable income.

“By making the purchases now you’ll be able to claim the deductions in the current financial year, rather than waiting 12 months,” she said.

“If you’re unsure about what you can claim, the ATO has created a series of fact sheets on deductions for different occupations and industries.”

Review investments

Ms Cathcart said selling shares or managed investments before the end of financial year could have an impact on the amount of tax you paid.

“Any gain on your investments becomes taxable income and may move you to a higher tax bracket,” she said.

Top up your super

“While making a salary sacrifice contribution reduces your take-home pay, it also increases your retirement savings and potentially reduces what you pay in tax,” Ms Cathcart said.

“Consider how much you want to contribute and whether it’s a one-off payment or an ongoing basis but make sure you don’t exceed the $25,000 annual concessional contributions cap.”

Review your expenses

Ms Cathcart said the end of financial year was the perfect time to review your major expenses.

“Considerable savings can be made by reviewing your mortgage interest rates, insurance premiums and other ongoing expenses such as electricity, internet and phone bills,” she said.

“Companies may have end-of-financial-year sales and putting in a bit of effort now could save you a significant amount in the long term.

“If you need more in-depth advice, a financial planner can develop a plan to get your finances on track for the future.”

The information in this article has been prepared for general information purposes only and not as specific advice to any particular person. Any advice contained in the document is general advice and does not take into account any person's particular investment objectives, financial situation or needs. Before acting on anything based on this advice you should consider its appropriateness to you, having regard to your objectives, financial situations and needs.