Aggressive Tax Planning

Do you have a big tax bill? Depending on if you are an individual or business you could be paying anywhere from 30% - 47.5% tax if you are earning a higher income.

While at Small Business Works we do not advocate Tax Avoidance it is wise for every Australian Taxpayer to strcuture their affairs to minimise tax where possible. There are a number of ways to reduce tax, to reduce your personal tax bill;

• Make sure you keep receipts for all work related items. If in doubt keep the receipt, we will happily tell you what is or isn't deductible at the end of the year.
• Make a donation to a Deductible Gift Receiptient, otherwise know as a charity or not for profit however be careful as not all charities are registered to accept tax deductible donations.
• Invest in a tax effective manner eg by investing in Property or Shares however you need to be careful to get your strategy right so that you minimise your tax bill but also do not take more risk than you need to. Our Financial Planning Firm can help with this.
• Salary Sacrifice to Super, superannuation is taxed at 15% which is probably lower than your marginal tax rate but do please check with a professional before doing this.

For Business Owners;

• Make sure you are operating under the most tax effectictive business structure (eg Company, Trust) also make sure you review this with your Accountant on a regualr basis.
• Consider the tax implications before making major decisions like asset and business purchases, business sales and succession plans.
• If you earn a substantial income consider setting up a special purpose vehicle like a family trust to hold your assets and potentially invest in a way the lowers your taxable income. Please see a professional about this as if done right you can lower your tax bill substantially.

Overall it is critical you understand and review your tax position on an annual basis (if not more often) we frequently save clients tens of thousands of dollars in tax by making simple changes to their financial structures. We do not beleive in avoiding paying tax but why pay more than you need to?

If you would like a free review of your current tax position please call 1800 556 122 and book an appointment today or contact our Accountants here