With 30 June 2025 fast approaching, now is the time to take stock, refine your strategies, and set yourself up for success in FY2026. Whether you’re an individual, a business, or managing a trust, proactive planning can lead to better tax outcomes, stronger compliance, and greater financial peace of mind.
Below, we outline key actions to take before the end of the financial year—tailored to individuals, companies, and trusts—with an eye toward sustainable financial success.
For Individuals: Secure Your Financial Future
1. Maximize Superannuation Contributions
Superannuation is central to long-term wealth creation in Australia. Before 30 June 2025:
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Concessional Contributions: Contribute up to the $30,000 cap (or higher if carrying forward unused caps). Includes employer and personal deductible contributions that reduce taxable income.
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Non-Concessional Contributions: Consider after-tax contributions up to $120,000, or $360,000 over three years under the bring-forward rule. Ensure funds are received by your super fund before 30 June.
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Spouse Contributions: If your spouse earns less than $40,000, you may be eligible for a tax offset by contributing to their super.
Action: Review your super balance and contribution history. Consult a financial adviser to align contributions with your retirement goals.
2. Review Tax-Deductible Expenses
Maximize deductions to reduce your taxable income:
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Work-Related Expenses: Claim items like home office costs, professional development, or union fees—ensure documentation is in place.
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Charitable Donations: Donations to deductible gift recipients (DGRs) are tax-deductible. Make them before 30 June and keep receipts.
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Investment Property: Prepay expenses like interest or insurance to bring deductions into FY2025.
Action: Organize receipts and consult a tax professional to ensure all eligible deductions are claimed.
3. Assess Investment Portfolios
Optimize your investment outcomes:
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Capital Gains Tax (CGT): Consider selling underperforming assets to offset gains. Assets held over 12 months may qualify for the 50% CGT discount.
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Dividend Reinvestment Plans: Evaluate if reinvesting aligns with your financial goals or if redirecting income supports cash flow.
Action: Meet with a financial planner to rebalance your portfolio for FY2026.
4. Update Insurance and Estate Plans
Ensure personal insurances are adequate and review your estate plan:
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Check if premiums (e.g., income protection) are tax-deductible.
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Update your will and power of attorney.
Action: Schedule reviews with your insurer and estate planner before 30 June.
For Companies: Strengthen Compliance and Strategy
1. Finalize Financial Records
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Reconcile Accounts: Match bank statements, invoices, and expenses.
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Depreciation Schedules: Update asset registers and claim eligible depreciation.
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Bad Debts: Write off unrecoverable debts to claim deductions.
Action: Conduct a pre-year-end review with your accountant.
2. Optimize Tax Strategies
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Instant Asset Write-Off: For small businesses (turnover < $10M), confirm eligibility and use assets by 30 June.
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R&D Tax Incentive: Document eligible activities for tax offsets (38.5% or 45%).
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Prepay Expenses: Bring deductions into FY2025 by prepaying rent, subscriptions, etc.
Action: Consult your tax adviser to identify concessions and maintain compliance.
3. Review Business Structure and Cash Flow
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Dividend Payments: Declare before 30 June to manage retained earnings and obligations.
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Employee Superannuation: Ensure all super payments are made by 30 June.
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Cash Flow Planning: Forecast FY2026 needs and reserve for taxes or contingencies.
Action: Hold a strategic meeting with your board and financial team.
4. Prepare for Compliance Deadlines
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BAS and PAYG: Lodge and pay outstanding amounts on time.
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Single Touch Payroll (STP): Finalize STP reporting for FY2025.
Action: Assign a team member to oversee compliance tasks.
For Trusts: Ensure Compliance and Flexibility
1. Review Trust Distributions
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Distribute Income: Document resolutions to distribute income by 30 June (or earlier if required by the trust deed).
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Streaming Provisions: Stream capital gains or franked dividends to suitable beneficiaries.
Action: Draft distribution resolutions with your accountant.
2. Assess Trust Structure
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Discretionary Trusts: Review deed flexibility and vesting dates.
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Unit Trusts: Align distributions with unit holdings.
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Tax Losses: Check eligibility to use carry-forward losses.
Action: Review the trust deed with your legal or tax adviser.
3. Address Family Trust Elections (FTEs)
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Confirm that only eligible beneficiaries receive distributions.
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Review any interposed entity elections.
Action: Verify FTE status and compliance with your accountant.
4. Plan for Trust Tax Obligations
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Trust Tax Return: Compile income, expenses, and distribution data.
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TFN Withholding: Ensure beneficiaries have provided their TFNs.
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Capital Gains: Manage CGT through careful investment and distribution planning.
Action: Finalize trust accounts and tax obligations with your adviser.
As we approach FY2026, the financial decisions you make before 30 June 2025 will influence your year ahead.
For individuals, it’s time to focus on retirement, tax optimisation, and wealth protection. For companies, it’s about staying compliant and positioning for growth. For trusts, it’s ensuring flexibility and tax efficiency.
Credits
Soundera Pandian Selvaraj
One Business Services Team
