Money

How to plan for tax time

Noel Whittaker
Noel Whittaker

June 30th is just a few short weeks away – a wake up call to think about ways to reduce your tax.  

Keep in mind that a basic principle of tax planning is to try to defer income to future years while, bringing forward expenses to the current financial year.  Therefore, if you have money sitting in the bank and are prepared to lose access to it for a few weeks place it on a term deposit with all interest maturing after June 30th.  The interest will then be taxed next year.

Conversely, if you have deductible expenses such as repairs and maintenance on investment properties, try to bring them forward so that you will enjoy your tax deduction now. 

You can bring forward expenses by prepaying 12 months interest on your investment loans or margin loans.  Pre-paying a year’s interest on a loan of $300,000 may cost you $24,000, but you could get up to $11,160 back as a tax refund. This strategy will require negotiation with your lender – you can’t just bank the equivalent of a year’s interest into the loan account, because all the lender will do is take one month’s interest and credit the rest to the principal.  

CGT can take a chunk of any investment profits, but remember that the relevant date is the date the sales contract is signed.  Therefore just deferring signing a contract until after June 30th can change a situation so that the CGT is paid when you are in a lower tax bracket. It also gives you an extra year’s use of the money you owe the tax man.

Anybody who is eligible to contribute to super but who does not have an employer making contributions for them, could also reduce CGT by making a tax deductible contribution to offset the capital gain.

As always take advice but don’t delay - when the clock strikes midnight on  30th June it will be too late.

Noel Whittaker is a director of Whittaker Macnaught Pty Ltd.  His advice is general in nature and readers should seek their own professional advice before making any financial decisions.  His email is noelwhit@gmail.com

Topics:  expenses income tax tax time


Stay Connected

Update your news preferences and get the latest news delivered to your inbox.

Register for Relay for Life 2017

SIGN UP: Lorna Hicks, Debbie Shields, Julie Sandeman and Ashlee Hansen at the Central Highlands Relay for Life 2016.

Throw your support behind Relay for Life 2017.

Day extra special for new citizens

FLAG DOWN A PARTY: The council will hold events all over the Central Highlands.

Australia Day will be extra special for our newest citizens.

Their stories live on

HISTORY LESSON: Lady Annie Brassey visited Tenterfield in July 1887 while spending much of the last 10 years of her life at sea. Hear her story on Australia Day.

Hear the region's stories of old at the historical afternoon tea.

Local Partners

CFMEU official under fire for corporate spending

Claims official spent "thousands of dollars" on corporate credit card including at Porters, Bunnings, Fresco's Quality Meats, Angelo's on the Marina, Sorbellos

Puppetry of the Penis secrets revealed ahead of show

The famed Puppetry of the Penis is coming to the Sunshine Coast for shows in Noosa and Caloundra.

WARNING: This interview contains adult themes and traces of nuts

Noll meltdown won't affect Gympie Oz Day concert

Shannon Noll

Photo Contributed

Shannon Noll is still expected to perform in Gympie next Thursday

Win your love with tickets

SMILES: Staff and children from Outside School Hours Care are fundraising for a new playground at the centre.

DAZZLE your darling with tickets to this year's Valentine's Day Ball

Kristen Stewart to host SNL

Kristen Stewart will host a pre-Super Bowl episode of SNL next month

Louis Tomlinson celebrated his son's first birthday

Louis Tomlinson and Briana Jungwirth celebrate son's first birthday

Kylie Minogue will take husband's name

Kylie Minogue will take her fiancé Joshua Sasse's surname

Nicole reveals her biggest parenting challenges

Actress Nicole Kidman.

Nicole Kidman says her kids are ‘deeply attuned' to her moods.

Suicide Squad director reveals his regrets about the film

Margot Robbie in a scene from the movie Suicide Squad.

DIRECTOR of superhero flick on what he’d change about ‘flawed’ film.

Meet the new Marco on MasterChef Australia: Yotam Ottolenghi

Israeli-born, London-based chef Yotam Ottolenghi will be a guest chef for a week on the 2017 season of MasterChef Australia.

AFTER Marco’s defection to Seven, MasterChef signs a true food hero.

Stockland's $150m pitch: Build it and they will come

Gladstone Marina. The Gladstone Regional Council offers a range of exciting job opportunities. Photo Contributed: Murray Ware.

Here's why we need to see Stockland upgrade start soon.

By the water's edge

Secure your seachange

HOT PROPERTY: Money to spend on land, buildings

File picture.

Sale, leasing of industrial real estate picks up in Mackay

Collapsed Coast company could owe up to $5 million

Staff, ATO, landlords among those out of pocket.

Ipswich block of dirt sells for $582 a square metre

JUST SOLD: A property on the Brookwater golf course sold for a record-breaking $612,000.

Property smashed 2007 record by close to $100,000

Ready to SELL your property?

Post Your Ad Here!