As the 2023 financial year-end fash approaches, we identify several opportunities for businesses to refine their books, optimise tax savings, and prepare for the next year ahead. 

Read on as we list our seven tips for last-minute end-of-year tax planning!

  1. Analyse Tax Deductions

While you may have obvious deductions, like utility and operational expenses covered, you could miss out on ATO initiatives, making it easier to save. Let’s look at two prime examples: 

  • Fixed-rate method: As of July 2022, this work-from-home (WFH) deduction enables you to claim $0.67 per hour to cover the costs of utility bills, equipment, internet, and stationery. 
  • Early-stage innovation company (ESIC) offset: Eligible investors in a startup with accelerated growth potential can obtain a 20% carry-forward tax offset and a 10-year capital gains tax (CGT) exemption.

Ensure you retain all invoices, logbooks, and receipts proving expenses to secure deductions confidently and efficiently. 

  1.  Review Saving Program Deadlines

The ATO offers several tax-saving initiatives that help businesses strengthen their teams, equipment, and energy efficiency. These programs only apply for a certain timeframe, many of which close at the end of the 2023 tax year. Review them below:

  • Small business skills boost: Small businesses turning over an aggregated $50 million or less can reduce tax by 20% when investing in training courses. Eligible courses must be hosted by registered training providers, like TAFE. The program runs from March 2022 to June 2024.  
  • Small business energy incentive: Small businesses with an aggregated turnover of less than $50 million can deduct the depreciating value of technical equipment purchased and installed between March 2022 and June 2023 by an added 20%.

  1. Clear Bad Debts

Write off any bad debts that you cannot solve before June 30th to ensure you can deduct the full amount from your tax bill. You must show evidence of genuine attempts to reclaim lost finances from the borrower, so use this time to communicate with relevant parties and clear the debt before the deadline.

  1. Apply Updated Instant Asset Write-Off Rates

Businesses can instantly deduct the full cost of assets, such as vehicles, costing $150,000 or less. The instant asset write-off initiative applies to entities turning over less than the aggregated $500m—access this deduction when purchasing new and pre-owned assets. 

  1. Time Invoicing and Plan Spending Strategically

Schedule invoices for after June 30th if you want to reduce your 2022–2023 tax bill. Similarly, bring forward major expenses, like investing in new workplace furniture or equipment, before June 30th to decrease the respective tax year’s assessable income.

  1. Reconcile Your Books and Accounts

While we encourage you to balance your books regularly, the lead-up to a new tax year poses the perfect opportunity to tie loose ends and start the 2023–2024 income year afresh. Perform or outsource audit services to reconcile business accounts and update your business activity statements (BAS). Reaching year-end with organised books will save considerable time when lodging the tax bill. 

  1. Contact Advisory One – You Still Have Time!

A strong financial plan relies on strong bookkeeping, planning, and accounting skills–that’s where we come in. Benefit from our several years of helping businesses and individuals meet their obligations and improve cash flow. Contact us to get started!