2020 Tax Planning for Businesses
1) Deferral of Income: if possible, defer issuing further invoices and receiving cash/debtor payments until after 30 June 2020. This strategy pushes tax payable to future income years.
2) Employee Superannuation: businesses should pay employees’ superannuation contributions before 23 June 2020 in order to obtain a deduction in the 2019/20 financial year.
3) Bring Forward Expenses: prepay insurance, rent or purchase marketing materials, consumables, stationery, printing and computer supplies before 30 June 2020, to get the deduction this income year.
4) Bad Debts: write off bad debts by reviewing your Trade Debtors list and writing off all bad debts BEFORE 30 June 2020. Prepare a management document listing each bad debt, as evidence that you have written off these amounts prior to year-end and enter these into your accounting system before 30 June 2020.
5) Stocktake: if applicable, you need to prepare a detailed Stock Take and/or Work in Progress listing as at 30 June 2020. Review your listing and write-off any obsolete or worthless stock items.
6) Resolutions/ Minutes: Trust Distribution Resolutions should be prepared and signed before 30 June. Distribution planning may be required to manage tax positions for the most tax effective outcomes.
7) Division 7A: Company Loans and Division 7A loan minimum repayments need to be made prior to 30 June 2020.
If you would like to know more about any of these tax planning strategies please do not hesitate to our office.