Six EOFY tips to make sure your finances are in order
End of Financial Year is in full swing so it is the time to get focused on your money life admin before 30 June ticks over.
Our top tips for end of financial year this year are:
1. Check your capital gains / loss position
We have had another positive year in investment markets. This means if you have sold any investments you may have triggered a capital gain. Implementing a strategy prior to 30 June could result in paying less tax on these gains.
2. Boost any income deductions on your investments
If you know you have earned more income this year than in the past (from the sale of an asset or maybe a voluntary redundancy payout) consider prepayment of interest on any investment loans you may hold. This could also lock in some protection from a future rate rise this next 12 months.
3. Consider additional contributions to Superannuation
This financial year was the first year that anyone under age 65 who makes a personal contribution to super can elect to claim this as a tax benefit. If you haven’t salary sacrificed as a PAYG Employee or if you are self employed.
Adding some extra money to super and claiming this as a deduction (make sure you let the super fund know of your intention) can be a great way to boost your tax deductions while investing in your longer term future! It could make a lifetime of difference.
Make sure you stay under the $25,000 Concessional Contribution Limit (this includes anything that your employer has paid into super on your behalf).
4. Review your Income Protection Insurance
If you are like most Australian’s you are probably under insured. Life gets busy and life admin is not always top of mind.
For most people the ability to continue to earn income if they are unable to work based on accident or illness is paramount. Having an income protection policy in place can transfer this risk.
Setting up a new policy or reviewing an older one and prepaying the premium for the next 12 months before 30 June could give you a tax deduction before the end of financial year.
5. Get your receipts in order
Start to review your past expenses for the year. My accountant has me well trained to have all my receipts in order for the business and for me personally so I can maximise any deductions.
If you haven’t got them in order start now, or get yourself setup for next financial year.
Check out some of the funky storage apps on your phone which can be a great way to track expenses and receipts! (Shoeboxed, DropBox and even the Australian Taxation Office app has a easy way to stores these)
6. Work related Tech Update
If you have been saving to upgrade your home office computer, laptop or tablet (the ones you use to track your investments and do your tax or work from home) you could buy a new one before the end of financial year to boost your deductions in the current year.
Talk to your accountant about depreciation and make sure you keep a log of time spend working from home to back up your claims.
Happy End of Financial Year! If you need assistance with any element of your money life, contact our office 1300 772 643.
Seek out further advice and start your journey to being free around your money and creating wealth with understanding.
Scott Malcolm has been awarded the internationally recognised Certified Financial Planner designation from the Financial Planning Association of Australia and is Director of Money Mechanics. Money Mechanics is a fee for service financial advice firm who partner with clients in Melbourne, Canberra and Sydney to achieve their life and wealth outcomes. We are authorised to provide financial advice through PATRON Financial Advice AFSL 307379.
The information provided on this article is of a general nature only. It has been prepared without taking into account your objectives, financial situation or needs. Before acting on this information you should consider its appropriateness having regard to your own objectives, financial situation and needs.