Login
iscover
Navigating tax obligations can be challenging for business owners and consumers alike. With tax laws evolving each year, staying informed and proactive is essential to managing your financial responsibilities effectively.
Newsletter
Key tax planning tips for 2025
14 January 2025
•
13 minute read
You’re out of free articles for this month
To continue reading the rest of this article, please log in.
Create free account to get unlimited news articles and more!
There are some key tax planning tips for 2025 that will help to minimise liabilities, optimise savings and ensure compliance - and help to reduce the associated stress of tax time.
Stay updated on tax changes
The Australian Taxation Office (ATO) regularly updates tax laws and staying informed is crucial for accurate reporting and compliance. Here’s what to watch in 2025:
-
Monitor tax law changes: Stay abreast of adjustments to tax rates, thresholds and deductions. Key updates may include changes to instant asset write-offs and concessional superannuation caps.
-
Understand the ATO’s compliance focus: The ATO is expected to focus on areas such as cryptocurrency transactions, work-related expenses and rental income reporting. Ensure your business practices align with these compliance areas to avoid audits or penalties.
It can be difficult to keep on top of these things when you are running a business or busy working and dealing with life so it is important to have the right support and advisors assisting you at all times.
==
==
Maximise your deductions
Deductions can significantly reduce your taxable income. Ensure you claim all eligible deductions by keeping detailed records and understanding what you can deduct.
-
Work-related expenses: Track and claim all necessary work-related expenses, such as tools, uniforms and home office costs.
-
Superannuation contributions: Consider making voluntary contributions to your superannuation fund. These contributions can be tax-deductible and provide long-term financial benefits.
-
Charitable donations: Donations to registered charities are tax-deductible. Ensure you keep receipts and verify that the charity is registered with the ATO.
A good tax professional will be able to provide direction and guidance on what can be claimed. Using apps and other technology can help to ensure receipts are retained and uploaded directly to your accounting system or tax agent's office immediately.
Plan for End-of-Financial-Year (EOFY) early
Waiting until June to think about EOFY planning can leave you scrambling. Instead, take a proactive approach throughout the year.
-
Regularly review income and expenses: Consistently monitor your financials to identify potential tax liabilities or opportunities.
-
Use forecasting tools: Leverage financial forecasting tools or consult with a tax professional to plan for upcoming tax obligations and avoid surprises.
-
Manage cash flow: Plan your cash flow to ensure you have funds available to meet tax obligations without disrupting your business operations.
Make smart decisions and business moves
Taking advantage of tax-efficient strategies can help reduce your personal and business’ tax burden.
-
Instant asset write-offs: The ATO offers instant asset write-offs for eligible business purchases. Review the current thresholds and consider investing in assets your business needs.
-
Income deferral and expense prepayment: Where feasible, defer income or prepay expenses to manage your taxable income for the financial year.
-
Business restructuring: Consider whether restructuring your business into a trust or company could improve tax efficiency. Consult a professional to determine if this is right for you.
Ultimately this is all about good planning. Planning in advance can help you to ensure you are managing your tax obligations in the most effective and efficient way possible.
Optimise your investments
Smart investment strategies can help you manage capital gains tax (CGT) and optimise returns.
-
Capital gains tax planning: Hold assets for more than a year to qualify for the 50 percent CGT discount. Strategically time the sale of assets to manage CGT liabilities.
-
Dividend plans: Review your dividend plans to maximise imputation credits. Align your dividend payouts with your income tax rate to optimise tax efficiency.
-
Negative gearing: For negatively geared properties, claim deductions for interest expenses, depreciation and maintenance costs to reduce your taxable income.
Prepare for retirement
Even if retirement feels far off, planning for it now can bring significant tax benefits.
-
Boost superannuation contributions: Increase your concessional (pre-tax) and non-concessional (after-tax) contributions to your super fund.
-
Transition to retirement income streams: Once you reach preservation age, explore transitioning your super to a retirement income stream, which can provide tax-free income after retirement.
I encourage people in their twenties to start planning for retirement. This is not just about retirement though, it is also about growing wealth through the benefits of compounding. The more super you accumulate, the more your money is working for you while you are dealing with life.
Stay compliant
Compliance is essential to avoid penalties and ensure your personal and business’s financial health.
-
Maintain accurate records: Keep detailed receipts and documentation for all income and deductions. Use accounting software to streamline record-keeping.
-
Lodge tax returns on time: Late lodgment can result in penalties. Ensure you submit your returns before the deadline.
-
Avoid common errors: Double-check your tax return details to avoid mistakes, such as incorrect bank account information or misreporting income.
Seek professional advice
Engaging a qualified tax professional can provide tailored advice and ensure you’re maximising your tax benefits.
-
Consult a tax professional: Tax professionals can help you navigate complex tax laws, identify opportunities for savings and ensure compliance.
-
Explore tax-effective strategies: Discuss options such as salary sacrificing, income splitting or setting up family trusts for long-term tax planning.
By implementing these tax planning tips, you can better manage your tax obligations in 2025. Staying proactive, organised and informed will help you minimise tax liabilities, maximise savings and confidently approach the financial year ahead.
You are not authorised to post comments.
Comments will undergo moderation before they get published.