Tax Tips From TaxPro

Last minute tax tips from Taxpro

As mentioned, only 2 days left to the close of what has been a year of decisions and changes. It is never too late for last minute deductions etc. Below please find some tips from us here at Taxpro.

1. If you are self employed and are looking for a tax deduction, pay some money into super. Most super funds are excepting payments up to 5pm today. This means you will get a tax deduction for this in the 2011/2012 year. Please bear in mind that if you are claiming a tax deduction for this contribution, the superfund will tax you 15%. So if you are in a 15% tax bracket already, it is not worth doing.

2. In regards to work related expenses, especially courses and subscriptions, please make sure you pay for the course and/or subscription by 30 June to give you the tax deduction in this year even though the course is to start in the New Year.

3. For business clients operating on a cash basis please be aware that your customers might pay you at the last minute so please be careful and plan ahead. If you are 100% sure you are getting the money in before the 30th, please start paying for outstanding bills. Please be aware that this will only help you if your income is high and you want to reduce your tax. In some cases where your tax rate is low, the deduction is better in the following year so it will not be worth paying for it now.

4. As it is end of year and you operate a business with trading stock, please conduct a stock take and value your trading stock. There may be great deductions if your closing stock is less than your opening stock at the beginning of the year.

5. Please keep your receipts for medical expenses especially if your out of pocket expenses are over $2,000. This will entitle you to a 20% rebate of the amount above $2,000. Please ring up Medicare and your Private Health insurance company and request a report on your out of pocket spending throughout the year.

6. If you don’t have any private health insurance and your income for the year was $80,000 as a single person or $160,000 combined with your spouse, you will get stung the extra 1% surcharge. If you fall into this category, please take out private health insurance to cover you for next year.