Tax time..... before you know it, June 30 will be here once again. So, how do you plan for your tax implications?
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Is it only when the accountant informs you that you need to pay "X" amount of tax after June 30 when you even think about tax?
Or... do you discuss with your accountant before the end of the financial year about strategies to best assist your business with its potential tax liabilities.
Good seasons and cash reserves with things going well can be great until you have the surprise from your accountant advising that you then have to pay half of your income to the ATO.
However, these situations can be avoided by spending a few hours with your accountant BEFORE June 30. Your accountant can provide you with estimates and various tax strategies that can legally reduce your tax liability.
Updates on new tax deductions can also be discussed, because let's face it, like many others, you may not have had the time to read that email or completely understand how legislative changes affect you personally.
These tax planning meetings with your accountant can take place at any time before June 30. But given the current timeframe it takes to purchase most items of plant and equipment, the earlier these meetings are held the better.
Remember tax planning is not illegal. It is simply treating taxation as an expense of the business and managing it in that way.
The key message is to prioritise a meeting with your accountant before June 30 and use their skills to assist your own business in minimising expenditure and creating wealth.
Cassandra Simpson is a director at HHH Partners.
