We are nearing “end of financial year 2023”, and I’m sure getting your personal tax refunds back as soon as possible will be top of mind!

Whether it’s to cover the cost of rising interest rates, adding to savings, or just having a holiday!

Here are some tips to prepare to minimise your tax as we near year-end.

Super

The personal super contribution cap remains at $27,500, so maximise this to get the deduction at your personal tax rate.

Also, to use up previous years unused cap balances (going back 5 years before they expire, limited to super balances up to $500,000).

Just to note, the Super Guarantee % has increased to 10.5% for 2023, and will be again increasing to 11% for 2024.

WFH and MV rates

The Work From Home (WFH) rate is changing! The Revised Fixed Rate is now 67c, and now includes a lot more. Costs such as mobile, internet, stationary and computer consumables (depreciation is split out).

Consider both the Revised Fixed Rate method or the Direct Cost method, to get the best deduction.

Record keeping is a MUST now! The ATO will not accept estimates – a Time Diary is required to be kept from the 1st March 2023 going forward. So make sure your WFH hours are being tracked!

The Motor Vehicle travel cpkm rate is increasing to 78c.

Investments

Record-keeping – make sure you’ve got all your income and expense records for any investment properties, shares and other investments, to accurately record the Profit/Loss on these, as well as any Capital Gains/Losses on investment sales.

The ATO is looking at these quite closely, particularly rental property deductions!

Technology Investment Boost

This is still subject to law, however Sole Traders may be eligible to claim the 20% boost deduction on technology spend, capped at $100,000, from the 30 March 2022, all claimable in the 2023 year.

Instant Asset Write Off

Eligible Sole Traders can claim the Instant Asset Write off which is unlimited to 30 June 2023. This is then capped at $20,000 from the 1 July 2023.

So if you have any assets that you need to buy, do so before 30 June 2023 to maximise the tax deduction.

Tax brackets and Offsets

There is no change to the personal tax brackets this year or next year (2023 and 2024), but we are expecting these tax brackets to change from 1 July 2024, to three personal tax rates – 19%, 30% and 45%.

If you have control over when you can receive a dividend, consider pushing these to the 2025 tax year, to benefit from the proposed lower tax rates.

We are unfortunately losing the Low and Middle Income Tax Offset this year.

As always, give us a call at MCA to discuss the above, and send through your information early in the financial year, for us to complete and get you the best tax refund we can!

This is general advice only and not to be interpreted as individual advice specific to your situation. Contact us to discuss the best solutions for your needs.”