What is the end of the financial year?

The financial year is a time period of 12 months used for tax purposes. The Australian financial year starts on 1 July and ends the next year on 30 June. Small business owners wrap up their books and begin finalising their tax time paperwork and accounting… And we’re here to help! Here are 7 tax tips for property investors:

  1. Prepay your interest – Your lender may let you pay the interest on your investment property home loan in advance, especially if you have a fixed-rate loan.
  2. Claim depreciation – Property investors can deduct depreciation on their property – that is, the annual decline in the value of the building’s structure, permanent fixtures and plant and equipment.
  3. Claim your borrowing expenses – This includes lenders’ mortgage insurance (LMI), as well as any loan establishment fees, valuation fees, mortgage broker fees and even any stamp duty you needed to pay on the mortgage itself.
  4. Lodge a PAYG withholding variation – A PAYG withholding variation lets you adjust the amount of PAYG you pay throughout the year so that you can effectively receive your tax deductions as they arise instead of having to wait to be reimbursed.
  5. Time any Capital Gains Tax events right – consider pushing exchange into July so that your profit is assessed against next year’s income. Talk to your accountant for specific advice on your own circumstances.
  6. Hold onto your receipts – The ATO treats your receipts as verification that you’ve spent the money you claimed so it’s important you hold onto them.
  7. Get good advice – The rules governing investment property deductions are complicated and sometimes downright confusing.
But wait… There’s more! This is also a time to get your super in order whether you’re a business owner or employee.
  • Add to your super – and claim a tax deduction – If you contribute some of your after-tax income or savings into super, you may be eligible to claim a tax deduction.
  • Get more from your salary or a bonus – If you’re an employee, you may be able to arrange for your employer to direct some of your pre-tax salary or a bonus into your super as a ‘salary sacrifice’ contribution.
  • Convert your savings into super savings – Another way to invest more in your super is with some of your after-tax income or savings, by making a personal non-concessional contribution.

This time of year can often be overwhelming and a lot to organise so get prepared now! Reach out to us at any time.

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