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2025 Business Tax Planning: Essential Tips

As 2025 approaches, effective business tax planning is more important than ever for business owners looking to minimise tax liabilities and maximise financial opportunities. With frequent changes to tax laws and regulations, it’s essential to stay proactive and make strategic decisions that benefit your business in both the short and long term.

In this guide to business tax planning for 2025, we’ll cover crucial strategies that every business owner should consider. From maximising deductions and strategically timing capital gains to structuring your business for tax efficiency, we’ll help you navigate the complex tax landscape. Whether you’re taking advantage of the Instant Asset Write-Off or looking to optimise your superannuation contributions, this article will provide the key insights you need to make informed decisions for your business’s financial health.

30 June Business Tax Planning is around the corner.

Maximising Tax Deductions with Instant Asset Write-Off and Pre-Paying Expenses

One of the most effective strategies in business tax planning for 2025 is taking full advantage of the Instant Asset Write-Off. This incentive allows businesses to claim immediate deductions for assets purchased and used in the business, up to a certain threshold. For 2025, it’s important to ensure that you’re aware of any changes to the limits and what types of assets qualify. Whether it’s equipment, machinery, or vehicles, the Instant Asset Write-Off can significantly reduce your taxable income in the current financial year.

Motor Vehicle Costs and the Instant Asset Write-Off

Motor vehicle expenses are often one of the largest costs for business owners, and under the Instant Asset Write-Off scheme, these costs are deductible. However, the cost limits for motor vehicles need to be considered carefully. In 2025, you can claim up to a set amount for the purchase of a motor vehicle, and keeping a detailed motor vehicle logbook is crucial if you’re looking to claim a portion of the vehicle’s costs based on business use.

If you’re unsure about how to claim motor vehicle expenses, be sure to check out this comprehensive guide from Pinnacle Accounting Advisory: Claim Motor Vehicle Expenses for Tax, which explains the process in detail.

Pre-Paying Expenses to Reduce Taxable Income

Another key business tax planning strategy is pre-paying certain business expenses before 30 June 2025. Pre-paying items like insurance premiums, software subscriptions, and rent can help reduce your taxable income for the current year. It’s a smart move, especially if you’re looking to lower your overall tax liability before the end of the financial year. Be sure to review which expenses are eligible for pre-payment and make these arrangements before the deadline.

By combining these tactics, you can make substantial progress in reducing your tax liability for 2025 while ensuring your business remains well-equipped for the year ahead.

Capital Gains Tax (CGT): Timing and Small Business CGT Concessions

In business tax planning for 2025, timing is critical—particularly when it comes to Capital Gains Tax (CGT). Selling business assets such as property, shares, or goodwill has significant tax implications. By strategically timing the sale of assets and taking advantage of available CGT concessions, small business owners can reduce their overall tax liability.

Timing Capital Gains to Minimise Tax Liability

The timing of when you realise a capital gain is crucial. If you expect a lower income in the next financial year, deferring the sale of assets until after 30 June 2025 may help lower your current tax liability by pushing the CGT obligation to the following year, when your income may be less.

Small Business CGT Concessions

Australia provides several CGT concessions for small businesses to help reduce the tax on asset sales. These include:

  • The 15-year exemption: If you’ve owned a business asset for more than 15 years and are aged 55 or older, you may be eligible to sell the asset without paying CGT.
  • The retirement exemption: You can reduce your capital gains by up to $500,000 if you’re retiring and meet specific conditions. This exemption is per individual, so it can be beneficial for business partners or co-owners.
  • The rollover concession: If you sell an asset and reinvest the proceeds in a replacement asset, you may be able to defer your CGT liability under this concession. This allows you to delay the CGT payment until you sell the replacement asset.
  • The Active Asset Reduction: If the asset is an active asset (i.e., it’s used in the day-to-day operation of your business), you may qualify for the 50% Active Asset Reduction. This concession allows small business owners to reduce the capital gain on the sale of the asset by 50%, effectively halving the taxable gain. This concession is available for individuals who meet specific criteria, including the use of the asset for business purposes for at least half of its life. The maximum reduction is $500,000 per individual.

By carefully timing asset sales and strategically using these CGT concessions, you can significantly reduce the tax payable on business asset sales, freeing up more funds for reinvestment or other business needs.

Optimising Business Structures: Tax Savings and Asset Protection

When it comes to business tax planning for 2025, one of the most important decisions you’ll make is choosing the right structure for your business. The structure you choose affects how much tax you pay, your personal liability, and your ability to grow your business effectively. It’s essential to ensure that your business structure is optimised for both tax efficiency and asset protection.

Choosing the Right Business Structure

There are several types of business structures in Australia, each with its own set of tax implications and benefits. The most common structures include:

  • Sole Trader: This is the simplest structure, where the business is owned and operated by one person. While it’s easy to set up, a sole trader is personally liable for the business’s debts, and profits are taxed at the individual tax rate.
  • Partnership: A partnership involves two or more people who share the profits and liabilities of the business. The income is distributed among partners, and each partner is personally liable for the debts of the business.
  • Company: A company is a separate legal entity from its owners, providing personal liability protection. Companies are taxed at the company tax rate, which is generally lower than the individual tax rate. This structure can be beneficial for businesses looking to scale and reinvest profits, as it also allows for dividends and franking credits.
  • Trust: A trust is a legal arrangement where a trustee manages the business assets on behalf of beneficiaries. Trusts can offer flexibility in distributing income and profits to beneficiaries, which can provide significant tax benefits. However, the setup and administration can be more complex.

Private Company Loans (“Div 7A”)

Business owners who have borrowed funds from their company must be aware of Division 7A rules, which regulate loans from private companies to shareholders or their associates, including directors. These loans need to be carefully managed to avoid unexpected tax consequences.

  • Loans to Directors: If a loan is made directly to a director, it must either be repaid by 30 June 2025, or a complying loan agreement must be put in place. This loan agreement must adhere to ATO guidelines, including a written agreement with an interest rate that meets minimum benchmark rates and a set repayment schedule. If these conditions are not met, the loan may be treated as an unfranked dividend, which would then be taxable to the director personally.
  • Loans Between a Family Trust and a Corporate Beneficiary: In cases where a family trust has loaned funds to a corporate beneficiary, the loan must either be repaid by 30 June 2026, or a complying loan agreement must be established before the lodgement of the company’s tax return for the 2025-2026 financial year. Similar to loans to directors, these agreements need to meet specific ATO requirements, including appropriate interest rates and repayment terms.

Trustee Resolutions for Family Trusts

If your business operates under a Discretionary Trust (often known as a Family Trust), ensure that Trustee Resolutions are prepared and signed before 30 June 2025. These resolutions are necessary for allocating trust income to beneficiaries, and failing to have them in place can lead to tax complications. Recent ATO rulings have impacted trust distributions to adult children, so it’s essential to consult with your accountant or tax advisor to ensure compliance.

By selecting the right business structure and ensuring that any associated loans or trust resolutions are properly managed, you can optimise your tax position and protect your personal assets.

Maximising Superannuation Contributions, Depreciation, and Franking Credits

Smart business tax planning in 2025 involves more than just managing income and expenses — it also includes forward-thinking strategies like boosting superannuation contributions, claiming depreciation, and using franking credits effectively. These tactics not only reduce taxable income but can also help improve long-term financial outcomes for both the business and its owners.

Maximising Superannuation Contributions

One of the most effective tools in business tax planning is contributing to superannuation. For the 2024–25 financial year, the concessional contributions cap is $30,000 (increased from $27,500 in previous years). Concessional contributions include employer contributions and salary sacrifice amounts, and they are typically taxed at 15% within the fund — usually lower than most individual marginal tax rates.

For business owners with irregular income or strong profits in 2025, there’s an opportunity to boost tax savings using the carry-forward rule. If your total superannuation balance was under $500,000 on 30 June 2024, and you haven’t used the full concessional cap in the last five years (starting from 2018–19), you may be eligible to carry forward unused portions of your concessional caps. This allows you to make larger deductible contributions in 2025 — potentially reducing a significant amount of taxable income in a high-earning year.

It’s important to ensure all contributions are received by your super fund before 30 June 2025 to be counted in this financial year, and to avoid breaching the cap to prevent excess contribution tax.

Claiming Property Depreciation

If your business owns a commercial or income-producing property — or you operate your business from one — you may be entitled to claim depreciation deductions. These deductions can be significant and typically fall into two categories:

  • Capital works deductions (e.g., for the building structure, renovations, etc.)
  • Plant and equipment depreciation (e.g., carpets, air conditioning units, furniture)

To claim the maximum allowable deductions, it’s often worth investing in a tax depreciation schedule prepared by a qualified quantity surveyor.

📺 Watch: Rental Property Depreciation – The hidden deduction
For a detailed walkthrough, watch our short video below on how rental property depreciation works and how it can benefit your tax position.

📽 Watch: Rental Property Depreciation – The hidden deduction
For a detailed walkthrough, watch our short video below on how rental property depreciation works and how it can benefit your tax position.

📺 Watch: The Complete Guide to Depreciation Tax Deductions
Want a deeper dive? This video provides a comprehensive overview of what depreciation deductions are and how to use them effectively:

Utilising Franking Credits

Utilising Franking Credits

If your business operates through a company structure, issuing dividends with franking credits can be a strategic way to distribute profits to shareholders while reducing overall tax liability. Franking credits represent tax already paid at the company level and can be used by shareholders to offset their own tax when lodging individual returns.

When planning dividend payments, business owners should consider:

  • The available franking credits in the company’s franking account
  • The timing of dividend declarations to ensure credits are applied efficiently
  • The structure of the wider group, especially where a bucket company or corporate beneficiary is used

If your structure includes a bucket company, it’s important to understand its purpose. While it is commonly used to cap the tax rate on trust distributions by directing income to an entity taxed at the corporate rate, its role goes beyond just tax efficiency. A bucket company can also serve as a legitimate asset protection strategy, helping to shield retained profits from potential claims, creditors, or litigation by distancing those funds from the day-to-day trading entity.

However, care must be taken to ensure all transactions involving franking credits and dividend flows comply with tax law and do not trigger anti-avoidance provisions. In particular, the ATO scrutinises arrangements where franking credits are manipulated without a clear commercial purpose.

Also, be aware of the risk of incurring Franking Deficit Tax (FDT). This tax applies if your company issues more franking credits than it has in its franking account, often due to poor timing or inaccurate tracking of prior tax payments. The company will be liable for the shortfall, and penalties may also apply.

Given the complexity, dividend and franking credit strategies should always be reviewed with your accountant or tax advisor to ensure full compliance and optimal use of credits across the business structure.

If you’re concerned about compliance or want peace of mind that your business is ATO-ready, check out our guide on ATO Audit Support for Businesses for practical tips and professional support options.

Conclusion: Prepare Early, Plan Smart

Effective business tax planning isn’t just about reducing your tax bill — it’s about making smart, forward-thinking decisions that support your business’s growth and financial security. As 30 June 2025 approaches, there’s still time to implement practical strategies that can minimise your tax liability and protect your assets.

From leveraging the Instant Asset Write-Off and prepaying expenses to structuring your business properly, managing Division 7A loans, and maximising super contributions, every decision you make now can have a meaningful impact on your bottom line.

At Pinnacle Accounting & Advisory, we specialise in working with business owners to develop tailored tax planning strategies that go beyond the basics. Our team can help you review your current structure, identify savings opportunities, and ensure you’re fully compliant with the latest ATO requirements.

✅ Now is the time to act. Don’t leave tax planning to the last minute.
📞 Contact us today to schedule your tax planning review and set your business up for a strong finish to the financial year.

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Australia’s leading Small Businesses Accountants so you can

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Unlock Tax Deductions for NDIS Support Workers: Maximise Your Refund

Discover essential tax deductions for NDIS support workers, a crucial aspect to enhance your financial well-being while helping Australians with disabilities.

image Pinnacle Accounting Advisory

Working as NDIS disability support workers is more than just a job — it’s a vital role that helps improve the lives of Australians living with disabilities. But while you’re busy caring for others, who’s looking after your finances? When tax time rolls around, knowing exactly what you can claim as a deduction could mean the difference between a modest and generous refund.

deductions for ndis support workers

Whether you’re employed, self-employed, or a sole trader under the NDIS scheme, understanding your entitlements can help you keep more of your hard-earned money. In this guide, we break down the essential tax write-offs NDIS workers often overlook — and how to make sure you’re claiming everything you’re legally entitled to.

Understanding Your Role as a Disability Support Worker

Before you start listing deductions, it’s crucial to understand how your role fits within the tax system. The Australian Taxation Office (ATO) categorises NDIS workers under several employment types — and each can influence what you’re eligible to claim.

✅ Who is an NDIS Worker?

NDIS (National Disability Insurance Scheme) workers include support workers, carers, allied health professionals, plan managers, and even those in admin roles. Whether you’re employed by a provider or operating as an independent contractor, you may be eligible for a range of support worker tax deductions — but the type and amount will depend on how you work.

🧾 Employee vs. Contractor: Know the Difference

If you’re an employee (on payroll with tax withheld), your deductible expenses may be more limited and tied directly to your employment conditions. But if you’re a sole trader or contractor, you can often claim a broader range of business-related expenses — as long as they’re directly tied to earning your income.

Understanding your classification is the first step in confidently claiming what’s yours.

The NDIS provider guidelines clearly define the scope of roles under the scheme, helping you understand where you fit — whether as a sole trader, contractor, or employee.

If you’re working as an independent support worker under the NDIS, you may have different tax obligations than employees

🛠️ Why Tax Deductions Matter

Every dollar you spend out-of-pocket for work-related purposes — from uniforms to fuel — can add up over a year. If those expenses aren’t claimed, you’re essentially leaving money on the table. By getting clear on your role and responsibilities, you’ll be in a stronger position to track your eligible costs and prepare for tax time more efficiently.

💬 Pro Tip:

Keep a work diary (even a simple app log) if you’re unsure which tasks or costs qualify as tax-deductible. This will be your best friend when it comes time to sort receipts or defend a claim during an ATO audit.

Common Tax Deductions for NDIS Support Workers You Can Claim

As an NDIS worker, your job likely involves a mix of physical work, admin, and travel — and each of these areas can come with tax-deductible expenses. Knowing what’s deductible (and what’s not) is key to maximising your return.

Here’s a breakdown of common deductions many NDIS workers can claim:

👕 1. Work-Related Clothing & Laundry

You can claim:

  • Branded uniforms
  • Protective clothing (like non-slip shoes or gloves)
  • Laundry costs for these items (if you wash them yourself)

Note: You can’t claim for everyday clothing, even if you wear it to work.

📚 2. Training & Education

Claimable expenses include:

  • Short courses or certifications related to your role (e.g., First Aid, Manual Handling)
  • Seminars or online training related to disability care or support work

These costs must directly relate to your current job, not a new profession.

📞 3. Phone & Internet Usage

If you use your personal phone or internet for work (like contacting clients, using NDIS portals, or rostering apps), you can claim a portion of:

  • Mobile phone bills
  • Internet bills

Keep a usage diary for a month to justify your work-use percentage.

🧰 4. Supplies, Tools and Equipment

You might be able to claim:

  • Assistive tools used in care, such as mobility aids, specialized equipment, or devices purchased specifically for work-related tasks.
  • Work-related equipment like laptops, phones, or other tools necessary for providing NDIS support.
  • Protective gear required for maintaining safety, such as gloves or face shields, especially when providing hands-on care.

🧾 5. Expenses for Support Workers Consumables

  • Consumables for client care: Items like gloves, sanitizers, and other personal protective equipment (PPE) used to maintain hygiene and safety.
  • Office supplies: Items such as pens, paper, printer ink, or diaries used for documenting and organizing client information.
  • Cleaning supplies: Cleaning products (like disinfectants) used to sanitise work areas or equipment, especially in healthcare settings.

🚘 6. Travel Between Jobs (More on This in the Next Section)

If you visit multiple clients in a day, you may be eligible to claim those trips. We’ll dig into this in the next section — stay tuned!

💡 Tip:

Always keep receipts or digital records. The ATO loves documentation — and having it on hand can make or break your claim if audited.

Vehicle and Travel Expenses for Support Workers Explained

If you’re regularly on the road visiting clients, travel could be one of your biggest (and most overlooked) tax deductions. But when it comes to claiming vehicle and travel expenses, the ATO has very specific rules — and getting it right can seriously boost your tax return.

🚗 When Can You Claim Travel?

You can claim travel between:

  • Multiple client homes or job sites during your shift
  • Your workplace and training events
  • Your office and supply stores (to purchase work-related items)

You cannot claim:

  • Travel from home to your first job of the day, or from your last job back home (this is considered “private travel”)

✍️ Claiming Car Expenses for support workers: Two Main Methods

  1. Cents Per Kilometre Method
    • Claim up to 5,000 km per year
    • No need for receipts, but you must be able to show how you calculated the distance
    • Rate for FY24–25: 85 cents per km
      (Confirm with the ATO for the most up-to-date rate)
  2. Logbook Method
    • Keep a logbook for 12 weeks showing work vs personal use
    • Claim a percentage of total car expenses (fuel, rego, insurance, servicing, depreciation)
    • Ideal if you use your car heavily for work

Support Workers Other Travel Expenses

🚌 What About Public Transport or Rideshares?

If you use buses, trains, taxis, or rideshares like Uber to travel between clients or to training, these are deductible — just make sure to keep your receipts or digital records.

🧾 Travel Diaries & Record Keeping

Keep a digital or written log of:

  • Dates
  • Start/end locations
  • Reason for the trip
  • Kilometres travelled (if driving)

A spreadsheet, mileage app, or even a good old notebook can do the trick — as long as it’s consistent and clear.

💡 Bonus Tip:

Use apps like ATO myDeductions or Stride to automatically track trips. It makes life 10x easier at tax time.

Home Office and Admin Costs

Even if you’re out and about most of the day, many NDIS workers spend time doing admin, planning, or logging case notes from home. If that sounds like you, there are legitimate home office deductions you should be taking advantage of.

🏠 What Qualifies as a Home Office?

If you perform work-related tasks at home — such as:

  • Completing care plans
  • Communicating with clients or coordinators
  • Writing up reports or case notes
  • Organising appointments or schedules

— then congratulations, your home workspace likely qualifies for deductions.

💸 What Can You Claim?

Here’s what’s commonly deductible:

  1. Electricity & Gas (Work Portion Only)
    • Use the fixed rate method (e.g. 67 cents/hour from 1 July 2022 onwards)
    • No need to calculate individual utility bills — just track your work hours
  2. Office Equipment & Furniture
    • Items like desks, chairs, laptops, and monitors
    • You can either depreciate large items over time or claim small purchases outright (if under the threshold)
  3. Internet & Phone
    • Claim a portion of your home internet bill, based on work usage
    • Similar to your mobile — only the work-related % is claimable
  4. Stationery & Admin Supplies
    • Notebooks, pens, diaries, folders, printer ink, etc. used for client-related tasks

📅 Method Matters: Fixed Rate vs Actual Cost

  • Fixed Rate Method: Easier, less paperwork — just track your hours.
  • Actual Cost Method: More effort but might result in a bigger claim (if you have lots of expenses).

Tip: Use whichever method gives you the higher deduction, and keep good records either way.

🧠 Pro Tip:

You don’t need a separate home office room to make a claim — just a regular space where you consistently do work tasks.

Record Keeping and ATO Compliance Tips

Even if you’re eligible to claim a range of deductions, it means little without proper documentation. The ATO takes record keeping seriously — and as an NDIS worker, so should you.

Depending on your employment status and award, the Fair Work Ombudsman’s disability services guide can help clarify what obligations and reimbursements you may already be entitled to — which impacts what’s deductible

📁 What Records Do You Need?

To support your deductions, you should keep:

  • Receipts or invoices for all work-related purchases
  • Bank statements showing relevant transactions
  • Logbooks or diaries for car travel and home office hours
  • Phone/internet usage records to back up percentage claims
  • Training certificates or course confirmations

Digital or physical copies are fine — just make sure they’re legible, complete, and stored securely.

🕒 How Long Should You Keep Records?

According to the Australian Taxation Office, you must keep tax-related documents for at least five years after you lodge your return. That includes receipts, logs, and correspondence.

📱 Use Tech to Your Advantage

Apps and tools can make record-keeping easy:

  • Xero (if you’re a sole trader, company or need accounting tools)
  • ATO myDeductions (free, official)
  • Stride (great for mileage tracking)

Back up your records on cloud storage (Google Drive, Dropbox, etc.) to avoid losing them.

⚠️ What If You’re Audited?

If you claim something without proof — even if it was legit — the ATO can deny it. In some cases, you might even face penalties. So treat your documentation like gold.

✅ ATO’s Golden Rule: “You must have spent the money, and it must relate directly to earning your income.”

If you follow that guideline and keep clean records, you’re in a great position to claim confidently.

Book Your Consultation Today

👉 Pinnacle Accounting & Advisory
✅ Accounting Firm in Narre Warren
☎️ 0431413530
🌐 https://pinnacleaccountingadvisory.com.au
📅 Booking Link: https://calendly.com/pinnacleaccoutingadvisorymina/discovery-session

Ready to do Business with Us?

Join countless small businesses and work with

Australia’s leading Small Businesses Accountants so you can

focus on growing your business – while we take care of the numbers.

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business cpa accountant

How your Small Business Accountant can save you money now?

In this blog, we will cover three very important things your small business accountant could be doing right now to save you money and help you grow your business. Understanding how to maximize your financial potential with a small business accountant is crucial in today’s competitive market. Let’s dive deeper into these strategies that can not only save money but also propel your business to new heights.

Firstly, we’ll cover the importance of tax planning. Secondly, we will discuss how a robust business strategy can grow your business. Lastly, we will delve into the importance of having a trusted network of professionals to support you on your business journey. These elements are interconnected and can significantly influence your business’s success.

Utilizing a small business accountant effectively can significantly enhance your financial strategies.

Your small business accountant can guide you through the complexities of tax regulations.

Tax Planning with Your Small Business Accountant

Different tax plans can have different consequences. This is why working with a Chartered Tax Advisor will ensure you are winning.

Partnering with a small business accountant enhances your understanding and management of financial matters.

Small business accountants possess an in-depth understanding of how to utilize different trading structures. Your small business accountant will ask tailored questions to determine the best structure for your unique situation. For instance, whether a sole proprietorship, partnership, or corporation fits your long-term goals can significantly impact your tax obligations and overall financial health.

A small business accountant can help identify where reinvestment can lead to increased business efficiency.

Engaging a small business accountant allows for customized strategies that fit your business needs.

Consult your small business accountant today to explore how proactive planning can benefit your financial future.

Your accountant will also have comprehensive knowledge of the various tax rates applicable to different trading entities. This expertise allows them to explain the implications of these rates in the context of your business, ensuring you are fully informed about your obligations and opportunities.

With insights from your small business accountant, your business strategy can reach new heights.

This process, known as Tax Planning with your small business accountant, can save you a significant amount of money. By applying legal avenues to minimize your tax liability, you can reinvest these funds into the business, enhancing growth potential. For example, reallocating saved tax funds into strategic marketing campaigns can elevate your brand’s visibility.

Your small business accountant can provide effective recommendations tailored to your objectives.

With these savings, you can reinvest in your business through advertising, purchasing new manufacturing equipment, or expanding your product line. This reinvestment can lead to increased revenue, which will, in turn, boost your overall business profit. Consider the long-term benefits of each investment decision and how they contribute to your growth trajectory.

As Chartered Tax Advisors, we have cutting-edge tax and business knowledge. Our proficiency allows us to cut through the complexities of tax regulations and provide you with clear, actionable advice. We understand that every business is unique, and we tailor our strategies to fit your specific circumstances.

As a result, we are able to save you money on tax and help you grow your business. Our clients have seen firsthand the benefits of proactive tax planning. Why wait? Call us today for a confidential, obligation-free initial consultation. Take the first step towards financial empowerment.

Business Strategy with Your Small Business Accountant
Having the right strategy can be the difference between a successful business and a business that is barely surviving.
A CPA brings a wealth of commercial understanding of the market. This extensive knowledge is not just theoretical; it translates into practical advice that can help steer your business in the right direction. A good accountant will analyze your current position and help you navigate potential challenges.
This understanding of the market can be broken down into the following seven key areas where the accountant can assist you:
  1. Establishing your why
    2. 


  2. Market Analysis
    3. 


  3. S.W.O.T Analysis
    4. 


  4. Marketing Plan
    5. 


  5. Unique Selling Proposition
    6. 


  6. Best trading Structure
    7. 


  7. Connecting you with other professionals
Trusted Network
  • Establishing your why: Understanding your purpose can guide every decision you make.
  • Market Analysis: Your accountant can help identify trends and opportunities in the market, ensuring you stay ahead of competitors.
  • S.W.O.T Analysis: This framework allows you to evaluate your business’s strengths, weaknesses, opportunities, and threats, creating a strategic plan for success.
  • Marketing Plan: A well-defined marketing strategy is essential for attracting and retaining customers.
  • Unique Selling Proposition: Clearly defining what sets you apart from competitors can enhance your appeal to customers.
  • Best Trading Structure: Choosing the optimal trading structure can maximize tax benefits and protect your assets.
  • Connecting You with Other Professionals: Building a network of support can lead to new opportunities and insights.
    • small business accountant
    Having a small business accountant in your corner helps you navigate through market complexities.
    Your small business accountant works with a diverse range of professionals. Thus, they can connect you with experts in various fields, enhancing your business’s support system. This network can provide invaluable insights and resources.
    • Commercial Lawyers
      • 


    • Family Lawyers
      • 


    • Marketing professionals
      • 


    • Conveyancers
      • 


    • Financial advisors
      • 


    • Auditors
      • 


    • Finance Brokers
      • 


    • Mortgage Brokers
      • 


    • Bookkeepers
    Above all, your accountant can connect you with the right professionals who match your unique needs and personality type. This personalized approach to networking can lead to stronger business relationships and more significant opportunities for growth.
  • Commercial Lawyers: Essential for navigating contracts and legal frameworks.
  • Family Lawyers: Important for personal legal matters that can impact your business.
  • Marketing Professionals: Experts who can help you design and implement effective marketing strategies.
  • Conveyancers: Vital for any property transactions related to your business.
  • Financial Advisors: They can provide insights on managing investments and pensions.
  • Auditors: Important for ensuring compliance and accuracy in your financial practices.
  • Finance Brokers: They can assist in finding the right funding options for your business.
    • Your small business accountant facilitates connections that are vital for your business’s growth.
  • Mortgage Brokers: Helpful for acquiring property to grow your business.
  • Bookkeepers: Crucial for maintaining accurate financial records.
    • Subscribe to our newsletter for valuable tips and insights that will help you stay ahead in the business world!
    



    

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      BUSINESS & ENTREPRENEURSHIP – 10 TAX CONSIDERATIONS
      Tax Time Pinnacle Accounting Advisory
      This article is designed to articulate a high-level general overview of some of the most important tax considerations for those in business and entrepreneurship. The article is not comprehensive in nature and professional advice should be sought to ensure correct application of issues mentioned where required.
      Topics Covered
      • Hobby or Business
      • GST Threshold
      • Motor Vehicle Cost limit
      • GST on Motor Vehicles
      • Payroll Tax
      • Superannuation
      • Award Rates
      • Fringe Benefits Tax (FBT)
      • Single Touch Payroll (STP)
      • Division 7A
      1.   Hobby or Business
      A hobby can be considered a business where a profit-making intention can be established, where profit has been made or the acts of a person show there is intent to operate as a business.
      The following factors may indicate that a profit-making intention and business exist:
      • Registration of a business name
      • Obtaining an Australia Business Number (ABN)
      • You make a profit
      • Repetition of business activities
      • The size or scale of the activity is parallel with the activities of other businesses in your industry
      • The activity is planned, organised and executed in business like fashion.
      The indicators that an activity is planned, organised and executed in business like fashion may include:
      • Keeping business records and account books;
      • Having a separate business bank account;
      • Operation from business premises; and
      • In possession of licences and qualifications.
      Worth noting is that an activity can begin its life as a hobby and morph into a business. An example is where an individual acquires an SLR Digital camera and proceeds to take photos at events and posts such photos on social media. Such photos receive praise from their viewers and the individual realises they have a natural flare and affinity for photography. They are encouraged to start a business. The individual decides to do just that and begins to plan. From this instant, it could be established the individual has left the territory of photography being a hobby to the pursuit of photography as a business.
      Where the hobby has become a business and the activity is generating a loss, you may be able to offset the business loss against your salary and wage income for tax purposes subject to meeting the non-commercial business loss tests. The non-commercial business loss tests are complex and discussion thereof is outside the bounds of this article. You should seek the advice of a qualified tax agent in this regard before applying such tests. 
      1.photography Pinnacle Accounting Advisory
      2.   GST Threshold
      The Goods and Service Tax (GST) is a tax payable by the end consumer (other than businesses not registered for GST). Businesses with turnover in excess of $75,000 must register for GST.
      Not for profit organisations which provide products or services must charge GST where their turnover is greater than $150,000.
      Some businesses are GST exempt, such as those providing medical services and do not need to register for GST. This means they do not include GST in the fees they charge their patients.
      However, registering for GST allows such businesses to claim GST credits on items and services they use to conduct their business.
      2.Goods And Services Pinnacle Accounting Advisory
      3.   Motor Vehicle Cost Limit
      As per the Australian Taxation Office’s definition, a motor vehicle means a motor-powered road vehicle and does not include a road vehicle where the following apply:
      • The main function of the vehicle is not related to public road use; and
      • The vehicle’s ability to travel on a public road is secondary to its main functions.
      Examples of vehicles meeting the above definition include but are not limited to:
      • Trucks, tractors and earth moving equipment.
      Vehicles purchased are subject to a Motor Vehicle cost limit of $57,581 for the 2019/2020 financial year. This means vehicles purchased above this limit will have deductions, which may cover numerous years, limited to the above-mentioned figure.
      This figure is regularly indexed and should be checked each year by referring to ATO guidelines.
      3.images Pinnacle Accounting Advisory
      4.   GST on Motor Vehicle Cost Limit
      If your business is registered for GST, you may be eligible to claim GST credits equal to one eleventh of the Motor Vehicle cost limit.
      This usually translates to $5,234.
      Other business assets are not subject to this limit and therefore the full GST credits applicable can be claimed.
      4.GST liimit Pinnacle Accounting Advisory
      5.   Payroll Tax
      Payroll tax is payable by employers where their payroll exceeds either a monthly or annual threshold provided by each Australian state and territory.
      The website below mentions the payroll tax thresholds and percentage rates applicable for each state and territory.
      https://www.payrolltax.gov.au/harmonisation/payroll-tax-rates-and-thresholds
      5.Payroll Pinnacle Accounting Advisory
      6.   Superannuation
      Superannuation is required to be paid for each employee where that employee earns $450 or more per calendar month.
      The minimum superannuation payable is an additional 10.00% of the wage or salary paid. This should be stipulated in the contract with the employee. Generally, employers combine the salary, wages and superannuation as a total remuneration package offered to their employees.
      See link below for table of rates and years to which they apply.
      https://www.ato.gov.au/rates/key–superannuation-rates-and-thresholds/?page=22
      6.Superannuation Pinnacle Accounting Advisory
      7.   Award Rates
      Certain employee pay is subject to minimum pay rates prescribed by Fair Work Australia. Paying employees in industries such as the hospitality industry below these rates is illegal. To determine the applicable rates for your employees based on the industry in which you operate, navigate to the below mentioned link and search for your industry.
      https://www.fairwork.gov.au/
      7 Award rates Pinnacle Accounting Advisory
      8.   Fringe Benefits Tax (FBT)
      Fringe benefits tax is payable at a rate of 47% by employers on benefits provided to employees or the employees associates. This is the case even if the benefit is being provided by an external provider under an agreement with the employer.
      These benefits could be the ability to use a company car for the employee’s private purposes or paying for an employee’s holiday. FBT is a complex area of tax and professional advice should be though if you are considering providing benefits to your employees.
      8.Fringe Benefits Pinnacle Accounting Advisory
      9.   Single Touch Payroll (STP)
      STP is a new way to report employees’ tax and superannuation information to the ATO. This information is now reported every time a business runs its payroll. This is a standalone process to preparing the Monthly Pay As You Go Withholding statements and the monthly Business Activity Statements where applicable.
      As of 30 September 2019, all businesses which employ staff must be registered for STP and report the information to the ATO.
      You can navigate to the ATO website using the link below to check out the no cost or low cost platforms available to satisfy the STP reporting obligations.
      https://softwaredevelopers.ato.gov.au/no-cost-and-low-cost-solutions-single-touch-payroll
      When considering which provider to choose, it is important to determine if such programs integrate with other business systems to ensure a streamlined no fuss solution is implemented.
      9. Single Touch Payroll Pinnacle Accounting Advisory
      10.   Division 7A
      Where using a company structure in your business then you need to be cognisant of Division 7A of the 1997 Income Tax Assessment Act.
      A company is a separate legal entity and stands alone from its directors and shareholders. As such, any income generated by the entity must be provided to shareholders and directors via declaration of a dividend.
      Where profits in the form of drawings are taken out of the company without a dividend being declared, Division 7A is triggered and may deem this to be a dividend to which the benefit of possible attached franking credits (also known as imputation credits) is disregarded. This is a disadvantageous spot to be in. Division 7A is another complex area of taxation for which further advice should be thought. 
      10. Division 7A Pinnacle Accounting Advisory
      Conclusion
      As can be seen, the above information provides a broad overview of various tax considerations when operating a business. The ATO website is a good resource to use to find out more. Another great website to visit to learn more about money and business is the Australian Securities and Investment Commission’s (ASIC) Money Smart website.
      Questions? Fill out the form below and we’ll reach out to you.
      

      

       
        

        

        

        

        
	
        
		
        
		
        
	
        
	
        
		
        
		
        
	
        
	
        
		
        
		
        
	
        

        

        
	
        
		
        
		
        
	
        
	
        
		
        
		
        
	
        

        

        

        

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