News, views and more

Tax planning checklist for Businesses, Individuals and Retirees – what to watch out for in 21/22

Business Taxpayers

Business taxpayers will need to prepare for the new year as well as the current year.

Prepare for the following:

  1. Increase in super guarantee contribution from 10% to 10.5% from 1 July 2022.
  2. Consider technology, skills and training expenditure to obtain an extra 20% tax deduction for 22/23. Expenditure can be made from budget night until 30 June 2023.
  3. Unlisted companies can, from 1 July 2022, offer Employee Share Schemes with less red tape, provided the monetary cap value is no more than $30,000 per year per employee.
  4. Review capital expenditure plans for now to 30 June 2023 to claim the full write off of assets under the Temporary Full Expensing budget measures. Alternatively, choose to not claim the full write off for specific assets (under flexible Opt out options).
  5. Determine if there are enough franking credits to pay dividends before 30 June 2022.
  6. Check shareholder loan balances and entertainment expenditure.
  7. Conduct a stocktake and review pricing strategies.
  8. Review your Debtors and write off bad debts.
  9. Calculate any bonuses you may wish to pay staff. Provided you have informed the staff of their eligibility for the bonus (i.e. the business has incurred the liability before year-end, it may be deductible to the business even if paid in the new financial year.
  10. Consider prepayment of deductible expenses that fall into the new year.
  11. Ensure employee super contributions are paid up to and before 30 June 2022 (any contributions paid in the new year, but before 28 July 2022 will be deductible in 22/23, not 21/22).

The best time for business taxpayers to review their tax situation is on/around the completion of the March BAS. It is also a good time to prepare a budget for the New Year. Check with your WLM accountant, as you may have access to the budgeting tool within Xero.

Individual Taxpayers and Retirees

  1. Concessional Super contribution cap (i.e. deductible super contributions increased from $25,000 to $27,500 effective 1 July 2021).
  2. Check you have withdrawn your minimum pension. Minimum pension requirements were reduced by 50% from 19/20 to 22/23. WLM will review all SMSF clients and advise accordingly.
  3. Effective 1 July 2022, the work test is no longer required for individuals aged between 67 and 75 who wish to make concessional or non-concessional contributions.
  4. For those aged 60 or over, from 1 July 2022, you may wish to consider a downsizer contribution of up to $300,000 from the proceeds of the sale of your main residence.
  5. Capital gains tax on the sale of investment assets. Check with WLM the likely tax impact and what options are available to minimise the tax, e.g. sale of a loss-making asset.
  6. If you or your spouse is a low or middle-income earner can you benefit from the Spouse Contribution Offset or Government Co Contribution? Check with your WLM financial adviser.
  7. Review your Crypto Currency records and Donations.

WLM can help

If you would like advice or assistance, please contact us

What financial services are right for you?
Make a comment

Wealth matters. Ask us how we can help you boost yours.