Tax planning for small business, before 30 June not after
Most business owners think about tax in July, when the year is over and the only thing left to do is report it. By then, the opportunities have gone. Tax planning is done before 30 June, with your actual numbers, while decisions can still change the result.
That’s why every one of our business packages includes a tax planning meeting before 30 June. Here’s what we look at.
1. Know the number first
Planning starts with a projection: your profit to date, a realistic estimate to 30 June, and the tax that would result for the business and for you. Without that, every “strategy” is a guess. Up-to-date bookkeeping matters here; we can’t plan from a file that hasn’t been reconciled since February.
2. Super contributions
Super is still one of the most effective ways to reduce tax legitimately.
- Concessional contributions (employer, salary sacrifice and personal deductible contributions) are taxed at 15% in the fund instead of your marginal rate. The general cap is $30,000 a year, including super guarantee.
- Catch-up contributions. If your total super balance was under $500,000 at the previous 30 June, unused cap amounts from up to five previous years can be used now. After a big year, that can be a large deduction.
- Timing. A contribution counts in the year the fund receives it, not when you pay. Contributions made in the last days of June through a clearing house can easily land in July. Pay well before the deadline.
- Employee super is only deductible to the business in the year it’s paid, so paying June quarter super before 30 June brings the deduction forward.
3. Timing income and expenses
The aim isn’t to avoid tax but to make sure it falls in the right year.
- Prepaying expenses. Small businesses can generally deduct prepaid expenses (such as insurance, subscriptions or interest) covering up to 12 months in the year they’re paid.
- Bad debts. Write off genuinely unrecoverable debts before 30 June to claim them this year.
- Obsolete stock and assets. Write off or scrap them before year end and you can claim the loss.
- Income timing. Where it’s legitimate, a large job invoiced in early July rather than late June falls in next year. Be careful: this only works if the income genuinely isn’t earned until then.
4. Assets and depreciation
Small businesses can claim an immediate deduction for eligible assets under the instant asset write-off, subject to a cost threshold that the government changes regularly [check: confirm the threshold for 2026–27]. Larger assets go into the small business pool and are depreciated over time.
The rule that matters most: buy what the business needs, when it needs it. A deduction saves you your tax rate, not the whole price.
5. Trusts, companies and director loans
- Trust distributions. A trust’s distribution resolution must be made by 30 June. Deciding who receives income, and how much, is one of the most valuable parts of the planning meeting, and one of the most closely watched by the ATO.
- Division 7A. Money taken out of a company that isn’t salary or a declared dividend can be treated as an unfranked dividend unless it’s put on a complying loan agreement with minimum repayments. Year end is when this gets sorted.
- Salary and dividends. For company owners, the mix of salary, super and dividends affects both your personal tax and the company’s.
6. Structure
If profit has grown a lot, the structure that suited you three years ago may now cost you. The planning meeting is the right time to model whether a company or trust would make a difference. See when to switch from sole trader to company.
7. Make it a plan, not a meeting
The output should be a written plan: what to do before 30 June, who does it, and what it saves. It should also cover the year ahead, including PAYG instalments, BAS, and cash set aside so next year’s tax isn’t a shock.
If your current accountant only talks to you in October about a year that’s already finished, that’s the conversation worth changing. Book a free consultation and bring your year-to-date numbers.