Are your tax obligations stressing you out? While it may be a few months away, thinking about your strategic taxation plan now could help you avoid headaches when your tax liabilities are due. Additionally, it ensures that you won’t overlook anything or come across unpleasant surprises.
Not sure how to go about your taxation plan? Here are some things you should know to help get you started.
What is Strategic Taxation Planning
Strategic taxation planning is the process of understanding, managing and anticipating tax liabilities based on your business financial goals and activities. Ideally, it’s recommended to carry out a review atleast annually so that your business is up-to-date with any changes in the taxation legislation. It also ensures that your taxation plan matches your current business goals.
Why is Taxation Planning Important
The most important benefit of having a taxation plan is that it allows you to minimise your tax liabilities within the rules and regulations in place. It also gives you more confidence in making strategic business decisions that could impact your finances.
When you fully understand your tax liabilities related to your business’s financial activities, you can take better control of your cash flow, debt payments, and other financial responsibilities.
Tips for Taxation Planning
When creating a strategic taxation plan, consider looking into the following factors:
- Cash flow — When you understand your business’s financial highs and lows, it will be easier to anticipate tax liabilities & deadlines and prepare for them. You would be able to avoid any undue financial strain on your business.
- Superannuation liabilities and contributions — Did you know that you could use your concessional superannuation contributions to reduce your tax liabilities? Often, business owners maximise their superannuation contributions in order to minimise their tax liabilities.
- GST cash accounting — This strategy could improve your cash flow as you pay GST at the point of collection and not when issuing an invoice to a customer.
- Small business restructure rollover — Looking to change your small business structure? Consider transferring active assets to another small business entity.
- Trading Stock Write Off – Obsolete/damaged stock – If identified, these items can be written off for accounting & tax purposes
- Bad Debts – Review your debtors and if any are unlikely to be recovered, write them off as bad debts before 30 June.
- Instant Asset Write off Concessions – concessions are available for eligible businesses that are looking to invest in fixed assets
- Prepaid expenses – bringing forward the recognition of certain expenses
Taxation planning doesn’t have to be complicated. At Glance Consultants, we specialise in taxation & cashflow planning for businesses. Our team of experts is ready to assist you in preparing your financial plans, financial statements and lodgement of your annual tax returns. We assist in the preparation and lodgement of your Business Activity Statements and variety of other lodgement obligations that you and your business face.
Call us at 03 9885 9793 or send an email to enquiries@glanceconsultants.com.au for more information on our business services.
