• Skip to content
  • Skip to navigation

Grant Thornton Australia

Grant Thornton uses cookies to monitor the performance of this website and improve user experience.

If you are happy to accept cookies from this site, please check the box.

To find out more about cookies, what they are and how we use them, please see our privacy notice, which also provides information on how to delete cookies from your hard drive.

How to be COVIDSafe when visiting Grant Thornton offices. Find out how

Global site
  • Global site
  • Algeria
  • Botswana
  • Cameroon
  • Egypt
  • Ethiopia
  • Gabon
  • Guinea
  • Kenya
  • Libya
  • Malawi
  • Mauritius
  • Morocco
  • Nigeria
  • Namibia
  • Senegal
  • South Africa
  • Togo
  • Tunisia
  • Uganda
  • Zambia
  • Zimbabwe
  • Anguilla
  • Antigua
  • Argentina
  • Aruba, Bonaire, Curacao and St. Maarten
  • Bahamas
  • Barbados
  • Bolivia
  • Brazil
  • British Virgin Islands
  • Canada LLP
  • Canada RCGT
  • Cayman Islands
  • Chile
  • Colombia
  • Costa Rica
  • Dominica
  • Ecuador
  • El Salvador
  • Grenada
  • Guatemala
  • Honduras
  • Mexico
  • Montserrat
  • Nicaragua
  • Panama
  • Paraguay
  • Peru
  • Puerto Rico
  • St Kitts
  • St Lucia
  • St Vincent and the Grenadines
  • Trinidad & Tobago
  • United States
  • Uruguay
  • Venezuela
  • Turks & Caicos
  • Afghanistan
  • Australia
  • Bangladesh
  • Cambodia
  • China
  • Hong Kong
  • India
  • Indonesia
  • Japan
  • Korea
  • Malaysia
  • Mongolia
  • Myanmar
  • New Zealand
  • Pakistan
  • Philippines
  • Singapore
  • Taiwan
  • Thailand
  • Vietnam
  • Albania
  • Armenia
  • Austria
  • Azerbaijan
  • Belarus
  • Belgium
  • Bosnia and Herzegovina
  • Bulgaria
  • Channel Islands
  • Croatia
  • Cyprus
  • Czech Republic
  • Denmark
  • Estonia
  • Finland
  • France
  • Georgia
  • Germany
  • Gibraltar
  • Greece
  • Hungary
  • Iceland
  • Ireland
  • Isle of Man
  • Israel
  • Italy - Bernoni
  • Italy - Ria
  • Kazakhstan
  • Kosovo
  • Kyrgyzstan
  • Latvia
  • Liechtenstein
  • Lithuania
  • Luxembourg
  • Macedonia
  • Malta
  • Moldova
  • Monaco
  • Netherlands
  • Northern Ireland
  • Norway
  • Poland
  • Portugal
  • Romania
  • Russia
  • Serbia
  • Slovak Republic
  • Slovenia
  • Spain
  • Sweden
  • Switzerland
  • Tajikistan
  • Turkey
  • Ukraine
  • UK
  • Uzbekistan
  • Bahrain
  • Egypt
  • Jordan
  • Kuwait
  • Oman
  • Qatar
  • Saudi Arabia
  • United Arab Emirates
  • Yemen
  • Lebanon
Grant Thorton Logo

Grant Thornton Logo Grant Thornton Logo

Contact us
  • Insights
  • Services
  • Industries
  • Meet our people
  • Careers
  • News centre
  • Locations
  • About us
  • Audit
  • Tax
  • Private Advisory
  • Financial Advisory
  • Grant Thornton Consulting
  • Asia
Audit Home
  • Audit methodology
  • Audit technology
  • Financial reporting advisory
Tax Home
  • Corporate tax
  • Employee equity reward schemes
  • Fringe benefits tax
  • Global mobility services
  • GST & indirect tax
  • International tax
  • Payroll assurance
  • Research & development
  • Tax compliance
  • Tax governance & risk management
  • Tax in mergers & acquisitions
  • Tax lawyers
  • Transfer pricing
Private Advisory Home
  • Family Business Consulting
  • Family office services
  • Private wealth
  • Superannuation
Financial Advisory Home
  • Corporate finance
  • Debt advisory
  • Forensic consulting
  • Payments advisory
  • Restructuring advisory
Grant Thornton Consulting Home
  • Business risk
  • Human capital
  • Performance improvement
  • Strategy & growth
  • Technology consulting
  • GNC Group Consulting
Asia Home
  • China practice
  • India practice
  • Japan practice
  • Agribusiness, food & beverage
  • Automotive dealers
  • Education
  • Energy & resources
  • Financial services
  • Health & aged care
  • Life sciences
  • Manufacturing
  • Not for Profit
  • Professional services
  • Public sector
  • Real estate & construction
  • Retail & consumer products
  • Technology & media
Agribusiness, food & beverage Home
Bite Size Dealtracker Food, Beverage & Agribusiness industry insights
Key insights for the Australian Food, Beverage & Agribusiness industry.
Financial services Home
  • Banking
  • Fintech
  • Private Health Insurance
  • Superannuation
  • Asset management
  • BEAR FAQs
  • Open banking
Royal Commission wrap up Top 10 things for Financial Services providers
Eleven months on from the first round of hearings for the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry, Commissioner Hayne’s final report has been released.
Health & aged care Home
Aged Care Royal Commission Perspectives on the Future of Ageing
Transitions in ageing are not consistent and systematic as they are described by our ageing systems. Sometimes they are incremental, sometimes accidental, sometimes monumental, and they are always personal. We can create something better.
Life sciences Home
Biotechnology Industry Position survey Australia's biotechnology industry drives economic growth
The 2019 Biotechnology Industry Position survey conducted by Ausbiotech and supported by Grant Thornton has revealed that new technologies across regenerative medicine and medicinal cannabis are disrupting the industry, and Australia's global strength in clinical trials continues to drive contributions to the economic and social fabric of the country.
Manufacturing Home
mid-sized business report Manufacturing is critical to our economy – how can we support the sector?
Although the knock-on effects of the Australian automotive industry exiting our country are yet to be fully understood, the industry is evolving, and manufacturing continues to be a major employer and critical to our overall economy.
Not for Profit Home
NATIONAL OUTCOMES MEASUREMENT PROGRAM A practical framework
Royal Commissions and federal budgets are critical things for Nonprofit human service providers to be thinking about at this point in time.
Real estate & construction Home
mid-sized business report Supporting affordable housing requires planning, certainty – and tax reform
There is a lot of noise around the property sector at the moment – and it’s not all positive. Prices are down – but this shouldn’t be a surprise when some markets (namely Sydney & Melbourne) saw unprecedented hikes in recent years.
Retail & consumer products Home
GNC Group Consulting The Technology Trap: Online innovation in retail
I recently attended the NRF Retail Big Show in New York, an overwhelming smorgasbord of retail technology and new store concepts.
Technology & media Home
  • Telecommunications
Scaling-up for Growth From start-up to scale-up
Navigating the complexities of growth and maintaining previous success is a challenge for all mid-size businesses.
  • Working at Grant Thornton
  • Student opportunities
  • Experienced careers
  • Contact us
Working at Grant Thornton Home
  • Flexibility
  • Your career and development
  • Diversity and inclusion
  • In the community
  • What we offer you
Student opportunities Home
  • Graduates
  • Vacationer Program
  • The application process
  • FAQs
  • Student application tips and tricks
Experienced careers Home
  • Client spotlight
  • Grant Thornton Australia | Audit, Tax and Advisory
  • Client alerts
  • 2014
  • Tax planning: What to consider before 30 June 2014

Tax planning - what to consider before 30 June 2014

03 Jun 2014
  • Tax planning: What to consider before 30 June 2014

With the end of the 2014 financial year rapidly approaching, now is the time to consider tax planning issues and items to be actioned before 30 June 2014 to ensure that you achieve the best tax outcome possible.

With the end of the 2014 financial year rapidly approaching, now is the time to consider tax planning issues and items to be actioned before 30 June 2014 to ensure that you achieve the best tax outcome possible.

Business income and expenses
Timing of income
Deferring income until after 30 June 2014 is a very effective tax planning strategy. If your taxable income for the year ending 30 June 2014 will be significantly higher than the year ending 30 June 2015, it is important to consider issues associated with the timing of income in the lead up to 30 June 2014, including:

  • the time of billing work in progress 
  • timing of sales income 
  • the date of entering into a contract for the sale of CGT assets

Maximising allowable deductions
Bringing forward deductions and utilising them before year end can reduce your taxable income for this year. These deductions may include:

  • prepaying interest on a deductible loan 
  • writing off bad debts 
  • paying membership subscriptions to trade or professional bodies 
  • ensuring your super contributions are made and received by the fund before 30 June 2014 
  • meeting bonus/commission and directors fee obligations
  • Depreciation can be claimed for assets first used, or installed ready for use before 30 June 2014

Prepayment of expenses
Small businesses (organisations with an annual turnover of less than $2 million) can claim expenses prepaid up to 12 months in advance such as rent, lease payments, interest, travel and insurance. Large businesses are generally limited to claiming expenses below $1,000.

Writing off bad debts
A deduction for a bad debt can be claimed in the 2013/14 financial year as long as the debt is declared bad by 30 June 2014. This can be done by preparing the minutes approving the write off and remove the bad debt from your debtor’s ledger.

Tip: Remember to also claim back the GST.

Superannuation guarantee
Employee superannuation contributions for the June 2014 quarter should be paid into the superannuation fund by 30 June 2014, rather than the statutory due date of 28 July 2014, to obtain a tax deduction this financial year.
Payment means that the funds have cleared the bank account and are received by the superannuation fund by the end of business 30 June 2014.

For the year ending 30 June 2014 all individuals have a concessional contributions cap of $25,000. Contributions above these caps are subject to tax at the top marginal tax rate.

Bonuses, commissions and Directors fees
Businesses can also claim a tax deduction for staff bonuses and commissions that are owed and unpaid at 30 June 2014, where it is “definitely committed” to the expense.

A company can also claim a tax deduction for Directors fees where it is “definitely committed” at 30 June 2014 and has passed an appropriate resolution to approve the payment. The Director is not required to include the fees in their tax return until the following year when the amount is actually received.

Even though payroll tax requires monthly monitoring of your payroll, it is a good idea to check that you have not exceeded the relevant annual payroll tax threshold, especially if you carry on business in more than one state or territory.  If you have exceeded the relevant threshold, you must register for payroll tax and be ready to report on your 2014 payroll.

Depreciation
Before the end of the financial year is a good time to review your depreciation schedule and note which assets have been scrapped.  Consider if any assets require a change in their effective life such that the current estimate of the effective life is inaccurate.  

Small business entities can elect to use the small business depreciation rules. These rules enable the immediate write off of depreciating assets as follows:

  • if acquired on or before 31 December 2013 – depreciating assets costing less than $6,500
  • if acquired on or after 1 January 2014 – depreciating assets costing less than $1,000

Stock on hand
Conduct a detailed physical stocktake of all stock on the 30 June 2014 and identify obsolete, damaged items and write them off before June 30, 2014.

Review valuations of trading stock in the lead up to 30 June 2014. Stock can be valued at the lower of the three different methods including:

  • cost 
  • sales value
  • market value

Small businesses are not required to perform a stocktake when the change in values is less than $5,000.

Personal taxation
New 2% Debt Repair Levy
The 2% Debt Repair Levy comes into effect on 1 July 2014. This levy will apply when an individual’s taxable income exceeds $180,000. It is imposed on the amount over $180,000. The levy effectively takes the top marginal tax rate from 46.5% to 49% including the Medicare Levy. Deferring income will result in more tax being payable if your taxable income exceeds $180,000.

Derivation of Income
It is worth considering whether assessable income should be deferred to the 2015 income year. The Medicare levy for individuals will increase from 1.5% top 2% from 1 July 2014 and the 2% Debt Repair Levy will also apply if your taxable income is greater than $180,000.  Deferring income to the 2015 year may result in more tax being payable.

Prepayments
In limited circumstances an immediate deduction is available for non-business prepaid (up to 12 months) expenditure (e.g. interest on investments).

Superannuation- Personal Deductions
It is important to check that the total of your personal contributions and any employer contributions made during the income year do not exceed $25,000. Otherwise, an excess contributions tax will apply. To be eligible for the superannuation personal deductions in 2014:

  • you must be under 75 years of age 
  • the amount you earn as an employee must be less than 10% of your combined assessable income, reportable fringe benefits and superannuation contributions; and 
  • you must notify the trustee of your fund in writing of your intention to claim a deduction

Rental properties
If you own a rental property, any net income or loss must be reported on your 2014 income tax return.

If you are likely to have a high taxable income then you may like to bring forward repairs and maintenance planned for the investment property into the 2014 financial year instead of leaving them to 2015. This decision should be weighed up with the increase in the Medicare levy and the imposition of the Debt Repair Levy if your table income is greater than $180,000.

Care should be taken in determining whether a maintenance or repair is deductible or considered a renovation or of a capital nature.

Tip:
Keep accurate records and copies of receipts of all expenses relating to your rental property.

Summary

It is important that you take the time to focus on tax planning and the tax issues that may affect you and your business before 30 June 2014.

Significant tax and cash flow savings can be created by the general tax planning strategies as discussed above.

For more information please contact:

Mauri Mucciacciaro
Mauri Mucciacciaro
Partner & Head of Private Advisory - Perth Perth
Email address https://au.linkedin.com/pub/mauri-mucciacciaro/9/a08/225/en Mauri Mucciacciaro VCard
View full profile
Share this page
  • Share this page on Facebook LinkedIn
  • Share this page on Twitter Twitter
  • Share this page on LinkedIn LinkedIn
  • Share this page on Wechat WeChat
  • Share this page via email Email
  • Follow us on youtube
  • Follow us on linkedin
  • Follow us on twitter
  • Follow us on facebook
Connectclose
  • Contact us
  • Locations
  • Meet our people
  • Subscribe
  • Staff portal
Aboutclose
  • About us
  • Careers
  • News centre
  • Client alerts
  • Grant Thornton Foundation
  • Grant Thornton Affinity
Legalclose
  • Privacy
  • Compliance and ethics
  • Disclaimer
  • Site map

© 2021 Grant Thornton Australia Limited – All rights reserved

    • EN
    • Contact us