outlay on June 29, producing a measly $1 deduction at tax
time).Ifyouaregoingtogetthatnewcomputerorcar
usedforworkpurposes,itisbetterbuyinginJulyas
depreciation has much more impact when spread over
a whole year rather than just a few days.6
NEGATIVE GEAR UPFRONT
Oneofthemajordownsidestonegativegearingis
cash flow. My preference is that you wait until the end of
theyeartogetyourrefundasitisaformofforcedsaving.
Butifcashflowistight,youmaywanttocompleteapay-
as-you-go (PAYG) withholding variation application,
which reduces the tax from your monthly pay. The form
isvirtuallyaminitaxreturnthatestimatesyourtaxable
income.Youstillneedtolodgeanannualtaxreturn.
Conversely, for those who don’t have a property, if you
struggletosave,agreatformofforcedsavingistoask
youremployertotakeoutextrataxineachpay packet.7
GET A GREAT ACCOUNTANT
Just as most people can change a tyre, most of us can
do our tax ourselves but it usually pays to get an expert
to look at it for you. The last thing you need is a knock on
thedoorfromthetaxmanbecauseyouclaimedtoomuch.
A registered tax agent knows where the boundaries are
intermsofwhatyoucanand,moreimportantly,can’t
claim.Andtheirfeeistaxdeductibletoo!
Maximise your accountant’s knowledge by communi-
cating with them often about your affairs. Aside from
pre-year-end tax planning, contact them before any major
transactionthatyouareabouttoundertake,asasimple
phone call may produce a simple strategy – such as setting
up a company – which could save you hundreds of thou-
sands over a lifetime. It is far easier to structure a trans-
action before the event occurs than months after.
You now have a whole new year to implement some
greattaxtips.It’stimetoact.Timesaretoughsoevery
dollar saved counts. Start your tax planning today.Mcancontributeupto$25,000,whichistaxedatonly15%
insteadofyourmarginaltaxrate(potentially49%).
As with the super co-contribution, very few maximised
this strategy each year as it was often too late in June to
top up compulsory super contributions to the threshold.
Ifyoucanputanextra$1millionoveralifetimeinto
retirement savings then you are potentially saving
$340,000 in tax (plus any returns on top of that). Would
that $340,000 mean you could retire a few years earli-
er or perhaps enjoy a more comfortable retirement? I’m
sure it would, so start putting extra super away in your
pay packet when July 1 arrives.
3
KEEPALOGBOOK
Work-related car travel is generally the biggest tax
deduction(inthethousands)forindividuals,yetso
manyfailtomaximiseit.Ifyouuseyourcarforwork-re-
latedpurposes,thelogbookmethodisbest,butagain
thisissomethingthatyoucan’tjustdoonJune30–it
takes 12 weeks of diligence in keeping accurate records.
I know from personal experience that logbooks are
annoyingcreaturestocomplete,butit'sjustaminute
in the morning, a minute in the evening – maybe 120
minutesovertheyearforpotentiallyanextra$5000in
tax savings. It's important to keep your receipts for all
costs associated with the running of your car (such as
petrol, insurance, registration, servicing and lease
payments), not just the logbook period. If you change
yourjobrole,getanewcaroryourlastlogbookismore
thanfiveyearsold,thenyouneedtostartanew one.
4
KEEP YOUR RECEIPTS WITH
MYDEDUCTIONS
Poor record-keeping is often associated with low refunds.
Tax agents cannot wave a magic wand if you don’t do
the basics and keep your receipts throughout the year
for your work- or business-related expenses. The ATO’s
rule, in most circumstances, is that no receipt results
in no deduction, so if you take work-related car travel
asanexampleyoucouldbecostingyourselfmany
dollars by not keeping those petrol dockets. Get into a
habitearlyintheyear.Thetaxofficehasagreatapp
called myDeductions, which is an easy way to record
your receipts by simply taking a picture with your
mobile device at the time you incur the expense.
5
BUYING TAX-DEDUCTIBLE ASSETS
Unless you are a small business (and can immedi-
atelywriteoffthepurchaseofnewbusinessassetsthat
cost less than $20,000), it is pointless buying a tax-de-
ductibleassetthatcostmorethan$300attheendof
thefinancialyear.Thisisbecausedepreciationofthese
assets is pro-rated for the number of days that you own
them during the financial year (resulting in a $1000
Wait until
the end
of the year
for the
refund, as
itisaform
of enforced
saving
WIN A COPY
Adrian Raftery, known as Mr Tax-
man (mrtaxman.com.au), is an
associate professor at Deakin
University.Heisalsoauthorof
101WaystoSaveMoneyonYour
Tax – Legally!(Wiley, $25.95).
We have five copies of the 2017-
18editionupforgrabs.Foryourchancetowintell
usin25wordsorlessyourbesttipforgettingtax
ready. Send your entries to [email protected].
au or Money magazine, GPO Box 4088, Sydney, NSW- Entries close August 9, 2017.