Taxation Planning – 8 ways to reduce your assessable income.

Reducing / deferring your assessable income is a widely used and effective means of minimising your taxation liability.

Some of the areas to consider include:

1.  Determining whether your business should be assessed on a cash or an accruals basis.

2.  Consider deferring your issuing of invoices until after 30 June (if assessed on an accruals basis) and your business is able to absorb the potential reduced cash flow.

3.  Capital Gains. If you are considering selling an asset that is going to produce a capital gain, deferring the sale date until after 30 June will place the gain into the next financial year.

4.  Consider the revaluation of trading stock.

5.  Trade Debtors. You may be carrying some trade debtors that won’t be collected. These would have been shown as income during the financial year and should be written off.

6.  Are cash receipts actually income? Consider the Arthur Murray Principal. Review contracts for the provision of services to determine whether income from such contracts can be regarded as only being derived as and when the services are rendered.

7.  Defer the receipt of interest.

8.  Defer the receipt of dividends.

If you would like to discuss further please contact us:

McNamara & Company - Chartered Accountants, located minutes from the Melbourne CBD

www.mcnamaraandcompany.com.au/contact-us

Phone +61 3 9428 1062

Email [email protected]

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