THE TWELVE DAYS OF TAX-MAS … 12 TAX TIPS FOR THE FAMILY OR INDIVIDUAL 2024/25 from Mr Taxman, Dr Adrian Raftery
30 June is rapidly approaching and it is time to do some urgent tax planning. Dr Adrian Raftery, principal of Mr Taxman and author of 101 Ways to Save Money on Your Tax - Legally! 2025-2026 edition (Wiley, May 2025, AU$32.95), gives some excellent tips for you to action and maximise your tax refund this year.
1. Claim a deduction for the costs you incur in running your home-office
More and more people these days are doing work at home but not many are aware that they can claim a deduction for costs you incur in running your home office, even if a room is not set aside solely for work-related purposes. At an absolute minimum keep a daily diary of your time that you work from home each day. Whilst you can use the ATO’s fixed rate method of 70 cents per hour it will probably be significantly less than actual deductions for the work-related portion of home telephone, internet, stationery, printers, computer equipment and consumables together with claiming a portion for electricity, gas and depreciation of home-based furniture under the actual costs method.
2. Keeping a car logbook could increase your refund by thousands
If you use your car for work purposes and keep a logbook for 12 weeks then the deductions can be in the thousands (and significantly more than the capped 88 cents per kilometre method on your first 5000 kms). Make sure that you keep all costs associated with the running of your car (such as petrol, insurance, registration, servicing and lease payments) for the whole year, not just the period that you kept the logbook. Remember that the ATO motto is no receipt = no deduction so you could be costing yourself $$$ by not keeping those dockets!
3. Take advantage of the Government’s free money service known as the “Super co-contribution”
It is surprising how few people actually take advantage of some free money from the Government. If your income is under $45,400 and you contribute $1,000 post tax into super the government will match it 50 cents in the dollar. Whilst this incentive gradually phases out above this figure at $60,400, it’s free money! Also, if you earn less than $37,000 then your spouse can put up to $3,000 into your super fund and they will receive an 18% rebate ($540) on tax via the spouse super contribution rebate.
4. Minimise capital gains tax (CGT) by deferring sale or offsetting losses against gains already made
The cryptocurrency and share markets have had a pretty good run in recent months, bouncing back strongly from the declines when Trump announced his “Liberation Day” tariffs. If you made a nice capital gain then you can reduce CGT by selling any non-performing shares/crypto that you may be currently holding. Any unrealised gains should be sold after 1 July to defer tax for another year. And remember that if you hold shares/crypto for more than 12 months you reduce CGT by half. Any capital losses incurred can be carried forward to future years so keep a record of them.
5. Build your nest egg quicker by paying 15% rather than 47% by salary sacrificing into super
Salary sacrificing into superannuation is one of the best, and legitimate, ways to minimise your income tax bill. You can contribute up to $30,000 per year into super (which includes the compulsory 11.5% employer contributions) which is only taxed at 15 per cent instead of your marginal tax rate (potentially 49 per cent). PAYG employees can make a lump sum contribution at the end of the financial year to take them up to the $30,000 cap and claim as a tax deduction. For those that don’t have excess cash lying about there are not many pay packets left to do it this tax year, so keep in mind to start putting extra away when 1 July arrives. And if your super balance was under $500,000 as at 1 July 2024, you can carry forward up to $132,500 in unused cap amounts from the previous 5 financial years ($25,000 cap in the 2019/20 & 2020/21 years & $27,500 in the 2021/22, 2022/23 & 2023/24 years) make a higher contribution this year.
6. Income expected to be lower next year? Bring forward some 2025/26 expenses into this year
If you are expecting that you will have a lower income next year - due to factors such as maternity leave, redundancy, a smaller or no bonus or perhaps cutbacks to overtime - then why not try to bring forward your deductions into this tax year. Stocking up your home office with stationery, laptops and printers or prepaying professional subscriptions, conferences and interest for up to 12 months in advance are just some of the simple ways to reduce your income before 30 June.
7. Recontribution to split superannuation balances between spouses
With substantial changes to superannuation over the last few years, financial planners across the country have been working like crazy to maximise the benefits for individuals. $2 million is the magical figure to have superannuation tax-free in retirement so it is crucial that couples maximise their $4M combined tax-free balance and not have one spouse over the $2M threshold with one well under. A simple strategy would be to have the higher-balance spouse withdraw up to $360,000 in super and recontribute into the lower-balance spouse’s super under the three-year rolled forward rule for non-concessional contributions. Important to see a financial planning expert here.
8. Buy any new business asset and claim it as a tax deduction this year
There have been some great tax concessions over the past few years for small business with none greater than the immediate write-off available for the purchase of new business assets that cost less than $20,000. There is no limit to the amount of assets that you can purchase under this concession but beware that you are only getting a percentage back and your cashflow will suffer. If your business is registered for GST, the threshold is effectively $21,999 as you can claim the 10% GST credit (up to $2,000) and get an immediate write-off for the balance in this year’s tax.
9. Manage your tax debt before the taxman cracks the whip
If you expect to have a tax debt then ensure you lodge your tax return and pay on time as the ATO have certainly ramped up their debt collecting activities in 2025 with the imposition of penalties and other firmer non-compliance actions available to them. If you cannot afford to pay on time then arrange a payment plan with the ATO for up to 12 months but note that any future tax commitments must be lodged and paid in full on time otherwise you will default and the ATO can impose further legal action. Any outstanding debts will attract an unattractive general interest charge – currently a whopping 11.17% - which will also be non-deductible from 1 July 2025.
10. Keep your receipts
With the need to get back as much as you can whilst things are financially tough during the current cost of living crisis, not to mention the ATO continuing ramping up audit activity yet again it is important to keep your receipts. The ATO motto is no receipt = no deduction so you could be costing yourself $$$ by not keeping those dockets! The ATO have a great app called MyDeductions which is an easy way to keep your receipts for year end.
11. Protect your tax identity
There has been a notable rise in activity by scammers stealing the tax identity of Australian taxpayers. Be incredibly wary on clicking on any links attached to text messages or emails purporting to be the ATO or other Government agencies. Whilst they may be legitimate, find an alternative way to login to fact check. Protect your TFN and myGov login details under all circumstances. Where possible, introduce multi-factor authentication (MFA) for all of your applications and provide an extra layer to deter these criminals.
12. Get a great accountant
Avoid paying too much in tax or leaving yourself to a visit from the taxman. Great accountants are like surveyors ... they know where the boundaries are. You can generally delay the lodgment of your return to May next year and their fees are tax deductible! Aside from pre-year end tax planning, contact them before any major transaction that you are about to undertake as a simple phone call may produce a simple strategy – such as setting up a company or having a property in the name of the lower earning spouse - which could save you hundreds of thousands over a lifetime. It is far easier structuring a transaction before the event occurs than months after!
You now have got some great tax tips, it’s time to take action. Times are tough during this cost of living crisis so every dollar saved counts.
This information is of a general nature only and does not constitute professional advice. You must seek professional advice in relation to your particular circumstances before acting.
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These tips were provided by Mr Taxman, Adrian Raftery, author of 101 Ways to Save Money on Your Tax - Legally! 2025-2026 edition (Wiley, May 2025, AU$32.95). @mistertaxman www.mrtaxman.com.au
101 Ways to Save Money on Your Tax – Legally! 2025-2026 edition
By Adrian Raftery
Published by Wiley May 2025
ISBN 9781284328635
AU$32.95
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For further information or to request an interview, please contact: Adrian Raftery on 1800 TAXMAN (1800 829 626) or 0418 210 599 adrian@mrtaxman.com.au