Taxpayers have the right to arrange their financial affairs so as to keep their tax to a minimum, often referred to as tax planning.
Tax planning is legitimate when done within the letter and the spirit of the law.
We would discourage clients investing in schemes offering large tax benefits without first independently researching the commerciality of the investment and secondly, obtaining a Private Ruling from the Tax Office.
Over the course of recent years, many tax planning opportunities have been removed or amended as a result of changes to Legislation. Quite often, tax incentives or deductions will only apply to small businesses with gross income of less than $2 million, or the Tax Office make things so onerous or complicated that people do not take advantage of them.
We believe that one of the keys to good tax planning for businesses is to meet with your accountant around April or May each year to review the interim financials with the view to:
- Looking at any Tax Minimisation opportunities;
- Projecting the annual sales and profit and analysis as part of a business performance review; and
- Projecting annual income tax and tax instalment obligations for the next 12 months or so for budgeting and cash flow purposes.
If you would like a review of your business tax structure to ensure you are doing everything possible and practical to minimise tax, please contact our Sydney or Gold Coast office.