Tax planning and strategies for individuals for 30 June 2024

Get possible allowable deductions and personal tax cuts sorted now and make your tax time easier.

As 30 June 2024 is fast approaching, we have prepared this document to provide you with some tax planning options. Taking advantage of some of these options may put you in a better taxation position this year.

If you need to know more about the items discussed in this letter, please contact our office for more information.

Personal tax cuts from 1 July 2024

Beginning on 1 July 2024, there are large tax cuts available for the majority of individual taxpayers in Australia. As the tax cuts apply to the next income year, the best strategy from a tax point of view is toreduce your taxable income in this tax year, when the tax rate is higher. However, the effects on liquidity must be kept in mind. The following options are available to you to reduce your income this year.

Bringing forward allowable deductions

By bringing forward allowable deductions to 2023–24, you benefit from reducing your tax bill at a higher rate per dollar.

Deductible superannuation contributions

If you are under the age of 75, you are able to salary sacrifice tax-deductible contributions from your employer up to the tax-deductible cap of $27,500.

Making additional deductible contributions

An opportunity is available to you if you have less than $500,000 in super and you want to claim a tax deduction higher than the cap of $27,500.

However, a specific limit will apply to you based on deductible super contributions that have gone into your account over the past 5 years. The additional deductible contributions may give you a deduction at this year’s higher marginal tax rate.

Delaying capital gains to next year

As the marginal tax rate is higher this year, where possible delaying capital gains tax events to the 2024–25 income year will improve the overall tax position. You will, however, need to be conscious of any unused capital losses that may apply to gains anyway, regardless of when the gains are made.

Also, you need to be aware that the Australian Taxation Office has current data matching programs to capture:

• any passenger movements away from Australia, which may be a CGT event if you become a non-resident

• cryptocurrency transactions with various registries, and

• changes to residential investment property loans, which may pick up any loans finalised due to a sale.

Home office expenses

If you are working from home, there are only 2 ways to claim deductions for working from home expenses:

• fixed rate method – 67c per hour, or

• actual cost method

It may be prudent to complete calculations to compare notional deductions with actual deductions. You do not require a dedicated area for the home office to be eligible to use the fixed rate method.

To make a working from home claim, evidence of total number of hours worked from home for the entire year must be maintained.

If you are expecting a tax refund, lodge early and electronically.

If you need to know more about the items discussed here, please contact our office for more information.