Year End Tax Tips 2024

The End of Financial Year 2024 is fast approaching. To help you get ready for the new financial year and to assist you with taking steps to not be in a position to pay more tax than you or your business are legally liable to pay, we have prepared some tips and actions that you could potentially take.

A common EOFY strategy is to make some last-minute work expenses in June, so you can claim them as tax deductions in July. As good as it may sound, but it also means spending money when you really don't need to, which is rarely a sensible plan.

If you are an Individual Taxpayer

1. Personal Tax Rates

The personal resident tax rates for the 2024-25 year are as follows:

• 0 to $18,200 — Nil
• $18,201 to $45,000 — 16 cents for each $1 over $18,200
• $45,001 to $135,000 — $4,288 plus 30 cents for each $1 over $45,000
• $135,001 to $190,000 — $31,288 plus 37 cents for each $1 over $135,000
• $190,001 and over — $51,638 plus 45 cents for each $1 over $190,000

2. Consider Additional Super Contribution up to the Cap

Both employees and self-employed individuals can claim a tax deduction for the Financial Year 2024 to a maximum of $27,500 for personal superannuation contributions. If the super contributions made by your employer on your behalf is under the $27,500 limit, if cashflow permits, you can make additional contributions up to the cap and claim the deduction for FY24. To be able to claim a deduction, your super fund should have physically received the contribution by 30 June 2024 and the individual has provided their superannuation fund with a notice of intention to claim. From FY25, the cap will increase to $30,000.

3. Take Advantage of Carry Forward Unused Contribution Cap Amounts

If your superannuation balance is below $500,000 as at the previous 30 June, you can contribute more to superannuation than the annual $27,500 deductible contribution cap, where your contributions in prior years were below the concessional contribution cap of that year. You can carry forward unused concessional contribution caps for 5 years from FY2019. Any unused caps from FY2019 that are not used by 30 June 2024 will be lost after that date.

4. Report Income from All Sources

Please note that you will need to report income from all sources including: Salary or Wage, Government Payments, Termination and Redundancy Payments, Online/Sharing/Gig Economy Income, Crypto and Share Capital Gains and Losses, Interest Income, Rental Income, Foreign Income, Personal Services Income and Sole Trader income. Failing to include all income when lodging is one of ATO's key focus areas for this tax time.

5. Work Related Expenses

Ensure you keep a record of all the work-related expenses, so you do not miss out on deductions. Please always remember the golden rules:

• You must have spent the money yourself and weren't reimbursed.
• The expense must be directly related to earning your income.
• You must have a record to prove it.
• If there was a private component, you can only claim a deduction for the work-related portion of the expense.

6. Motor Vehicle Logbooks

Make sure your motor vehicle logbooks or work-related travel diary is up to date to substantiate any work-related expense deductions. If your current logbook is 5 years old, you will need a new one for a continuous 12-week period.

7. Working From Home

The ATO has announced changes to the way taxpayers claim working from home deductions. You can use the following two methods to calculate your Work from Home Expenses:

• Revised Fixed Rate Method: The fixed rate of $0.67 cents per hour applies from 1 July 2022 onwards and includes Energy Expenses, Phone usage, Internet, Stationery & Computer Consumables.
• Actual Cost Method: If you have a dedicated home office area set aside, you can use the actual method with detailed records of all expenses.

8. Rental/Investment Properties

If you own one or more rental/investment properties, it is important to start assembling relevant documents such as statements and invoices/receipts for your 2024 tax return. Rental Properties continue to remain one of ATO's key focus areas for this tax time.

9. Consider Income Protection Insurance

Investing in income protection not only provides peace of mind that your family is taken care of should anything happen to you, but you can also claim it as a tax deduction.

For Businesses

1. Instant Asset Write-Offs – $20,000 limit from 1 July 2023

The government has announced their intention to legislate increasing the threshold to $20,000 for the period 1 July 2023 to 30 June 2025. This measure has not become a law yet.

2. Perform Stocktake – Write off Obsolete Stock

Review your stock valuation and write-off any stock that is damaged or obsolete. Complete a stocktake and remember that stock can be valued at the lower of cost or net realisable value.

3. Payroll & Single Touch Payroll (STP)

All employers are now required to run their payroll through accounting and payroll software that is Single Touch Payroll (STP) ready. Employers should ensure their STP year-end finalisation reports are lodged by 14th July.

4. Review Staff Pay Rates

Take time to review your staff pay rates and conditions of employment by referring to the Fair Work Commission's current guidelines and make any changes required from 1 July 2024.

5. Pay June Quarter Super by 30 June

In order for small business owners to claim the tax deduction on super contributions made on behalf of employees, the super has to be paid before 30 June.

6. Super Guarantee (SG) Rate Change

From 1 July 2024, the SG rate is set to increase by 0.5% to 11.5% for all employees.

7. Write-off any Bad Debts

Review your debtors and write off any unrecoverable debts. These debts will come off your income in the year in which you write them off, regardless of the year you invoiced them.

8. Trust Resolution

Prior to 30 June every year, the trustees of discretionary trusts are required to make and document their resolutions on how the income from the trust is distributed to its beneficiaries.

Please note that the information provided above is general only and does not constitute personal financial advice. Before acting on any information provided above you should consider the appropriateness of the information having regard to your objectives, financial situation and needs.