How to beat the ticking tax clock

Being an early bird pays off if you want to maximise this year’s tax refund

TAX time is just days away and the clock is ticking for anyone thinking about engineering a juicy refund.

Many tax deductions need to be organised well before June 30, and whether it’s for your work, your superannuation or your investments, it pays to be an early bird.

Prescott Securities financial adviser Su Goh says making an effective tax plan before the end of the financial year can make a significant difference. “The key is to get started before it’s too late,” she says.

AMP financial planner Mark Borg says acting before June 30 opens up more opportunities.

WORK DEDUCTIONS

Tax deductions for work-related expenses are common, but some work claims can be missed.

“You may be able to claim a portion of self-education expenses if it’s related to your ability to earn an income,” Borg says.

People who work from home can often claim for cooling, lighting, cleaning and interest on some loans. Read the ATO’s guide to home office expenses on ato.gov.au.

Many tax deductions need to be organised well before June 30.

SUPERANNUATION

Super has a smorgasbord of tax benefits. Borg says there options no matter how much you earn or how old you are.

“You can claim up to $500 in government co-contributions if you’re a low to middle income earner and you make after-tax contributions of up to $1000 to your super,” he says.

“You can receive a tax offset of up to $540 if your spouse is a low income earner and you contribute up to $3000 in after-tax contributions towards their super.”

SAVE MONEY TODAY

Salary sacrificing part of your salary means you only pay 15 per cent tax rather than your marginal tax rate, but it can only be organised in advance. Self-employed people can claim a deduction for deposits they make into super before June 30.

Goh says workers aged over 55 can look at starting a transition to retirement pension. “This can reduce personal marginal tax rates as well as result in zero tax in super earnings,” she says.

INVESTMENTS

Several strategies are available to investors and retirees, Goh says. “Realising capital can reduce capital gains while deferring income or bringing forward expenses can also be beneficial.”

Property and share investors can prepay interest on investment loans and bring forward big deductions, but need to be organised in the next few weeks.

Property investment bills such as insurance and maintenance costs can also be paid before June 30 to ensure a quick tax turnaround.