Monday, June 27, 2022
Google search engine
HomeUncategorizedWant to minimise your tax as an Employee?

Want to minimise your tax as an Employee?

WE NEED FUNDS TO FIGHT MAINSTREAM MEDIA MISINFORMATION

We are 100% independently owned, free from corporate ownership and control. Help support a free press by donating to us.

It’s not too early to start your tax planning prior to 30 June. Often, the month of June brings out the savvy tax saver who is on the hunt to minimise tax. They call their Accountant and ask, ‘I don’t want to pay as much tax this year, what can I do to minimise my tax and get a bigger refund?’

The Accountant has probably already fielded a few of these calls already by the time the Queen’s birthday weekend has rolled around but why wait until then? Let me show you some ways to minimise your tax during the year.

1. Salary Sacrifice an Electronic Portable Device If you use the device predominantly for employment, you can salary sacrifice the full cost of the device through your pay. Examples of devices are as follows:

– Mobile Phone

– Tablet

– Calculators

– Personal digital assistants

– Laptop computers

– Portable printers

There is a limit to one device per FBT year (1 April to 31 March) but if you work for an eligible small business, you can get up to two different items per FBT year.

Salary sacrificing an item won’t necessarily mean a larger tax refund in your end of year tax return but it will reduce your Gross pay, therefore reducing the PAYG withheld from the relevant pay period. An example – if your marginal rate is 34.5% and the item cost $1,000, your Gross Pay will reduce by $1,000, PAYGW will reduce by approximately $345 and you take home pay will reduce by only $655.

For more details, visit the ATO website or contact your Tax Agent.

2. Salary Sacrifice extra into Superannuation.

Generally, as an employee you can salary sacrifice into super and this can start from day one of the financial year.

Salary sacrificing into super is where you can arrange with your employer to contribute pre-tax income into you super account over and above the 10% super guarantee that they are due to pay. Doing this reduces your taxable income, therefore saving tax.

Your Super Fund generally pays 15% tax on these contributions but this arrangement may effectively transfer income that is taxed at 34.5% into a concessionally taxed environment of 15%.

Each year there are limits as to how much you can contribute into super so you need to be careful how much you sacrifice as going over these limits can lead to excess contributions tax imposed by the ATO.

You can also make personal after tax contributions into super during the year. If you do this, you can complete a Notice of Intent to Claim Super Deduction Form at the end of the financial year (subject to concessional contributions cap) and include this deduction in your tax return.

Before you lodge your tax return, you need to receive confirmation from your Superannuation Account that they have accepted your Notice of Intent and have noted that you intend to claim the deduction in your income tax return.

There are differing tax and contribution rules for those that have Constitutionally Protected Funds like SuperSA so regardless of which Superfund you are a member of, it is recommended that you seek professional advice regarding a super contribution strategy.

3. Make regular donations to charitable organisations that are Deductible Gift Recipients (DGRs).

Donations of more than $2 made to DGRs can be claimed as a tax deduction but make sure you keep your receipt!

Often, generous people make donations but forget to file the receipt or never ask for one. Keeping the receipt enables you to claim the donation in your tax return and ensures that you’re legally reducing your taxable income.

Often, you will get an email with the receipt attached if you have donated online. File this in a folder on your computer (or in the cloud) as donations and make sure you have this file ready at tax time.

Is your partner in a higher tax bracket? Make out the donation in their name as that can lead to saving more tax in their tax return… which is better for the family… of course.

4. Use a Tax Agent.

This might not necessarily save you tax during the year but having an ear to listen to your needs could be useful.

Yes, inevitably they will charge for preparing your tax return and maybe for some advice but this could be money well spent as they are there to legally help in reducing your taxable income. AND the fee for their services is usually tax deductible.

An added bonus, if you always lodge your tax return before 31 October and enlist with a Tax Agent prior to 31 October 2022 for your 2022 tax return, you can get an extended lodgement date to either March, May or June 2023. This could be a handy extension if you have a significant tax bill thanks to a massive capital gain you may have had on selling your investment property.

Scott has been a registered tax agent since 2015 and a tax and business account since 2007.

RELATED ARTICLES

9 COMMENTS

  1. I found the super advice really interesting! I guess as a ‘30 something’ super often takes the backseat as retirement seems so far away!

  2. I have been working for 15 years and never look forward to tax time. Thanks for the tips. I will remember to keep my donation receipts from now on.

LEAVE A REPLY

Please enter your comment!
Please enter your name here

- Advertisment -
Google search engine

Most Popular

Recent Comments

Ivan M. Paton on Approval Of Remdesivir
Beth on Free and Fair?
Novus Ordo Seclorum on Victorian Change to Mandates
Novus Ordo Seclorum on Health care in crisis
Novus Ordo Seclorum on Health care in crisis
Burnthehousedown on Postal vote outrage
Shanthini Balasuriyar on Queensland CHO – a law unto himself
Billie Hutton on Convoy to Canberra Two
Lynn a freedom warrior on Convoy to Canberra Two
Elizabeth on Ruble on the rise
Yvonne Ford on Pfizer drug recall
Gene Trevor Wyngaard on NZ Scrap vaccine mandates
Frances Mahy on Russia Sanctions The U.S.A
Peter Coxhead on My Story, So Far
Theodora Zajaz on Novak Out Of U.S. Open.
Leonie Young on Probuild Buy-Out
Shelley Madden on Pfizer, Stranger than Fiction
Debra Mullins on AVN vs Brendan Murphy
Malcolm on The End Game
Sabina on What’s Next?
Drew Duncan on Belarus Under Threat
Robyn on What’s Next?
Sofia Rutteman on Here We Go Again, Part 2
Robert Burns on Ricardo Bosi Public Address
Kim Henry on Pfizer Whistleblower
Lee Y on Give Me Five
Linda Nemeth on Ricardo Bosi Public Address
Warwick Hibble on Ricardo Bosi Public Address
Lesley on The Data Is Ours
Patricia Poppeliers on Here We Go Again, Part 2
Dani Stevens on Trouble in Paradise
Colin Stevens on VICTORY FOR THE PEOPLE
Leanne Robyn on VICTORY FOR THE PEOPLE
Dianedraytonbuckland on Facebook: Judge, Jury and Executioner
Michael Chere on Before You Inject Your Child
Kerry Taylor on Which one of us is blind?
Kathy Hirsch on First Nations Locked Down
Gloria Feather on Undermining The Indigenous.
Marie Millikin on Let us talk about intuition.
Lucienne Helm on Let us talk about intuition.
Susan Wilson on The real revolution
Jennifer Leonard on 2020 a year to forget
F J on Strange Times
Tracey Parsons on IBAC DAY 9
stacie rose on Which one of us is blind?
Uncertainty on My Story, So Far
Tracey on A Veteran’s Plea
Zaidee Lens Van Rijn on My Story, So Far
Alissandra Moon on The Rise of Medical Apartheid
Peggy Gothe on Mum, I don’t feel well
Keith Cashman on Mum, I don’t feel well
Melinda c Taylor on Mum, I don’t feel well
Vaughan Oke on Which one of us is blind?
Jane Ramsay on Choice vs Ultimatum
Brian K Wilson on Which one of us is blind?
Scott Dawson on Which one of us is blind?
Sandra Dee on ST KILDA STREET PICNIC