With 30 June fast approaching, now is the time to make sure your business is ready to close out the financial year on the front foot. This guide brings together practical, easy-to-understand tax strategies designed specifically for Australian business owners. It covers essential year-end actions and incorporates the latest insights from the ATO, ASIC, and AASB to help you reduce tax, stay compliant, and prepare confidently for the new financial year.
1. Proactive Tax Management and Record-Keeping
Start planning early to avoid last-minute issues. We recommend keeping clear records for all tax matters — from invoices and super payments to trust resolutions and loan agreements. Cloud platforms like Xero, MYOB, and QuickBooks help you stay organised and audit-ready. Regulators are paying close attention to financial disclosures, asset values, and provision estimates this year. If your business is large or works with larger entities, you may be affected by the new sustainability reporting standards (AASB S1 and S2), even if you're not directly captured. Businesses with 100+ employees or $50m+ revenue may be required to start reporting climate-related risks from 2025.
2. Accelerating Deductions
If your business earns less than $10 million annually, you may prepay up to 12 months of business expenses like rent, insurance, and subscriptions and claim them as a deduction this year. This rule applies to the same group of businesses eligible for the $20,000 asset write-off in Section 4. Ensure payments are made before 30 June and relate to the coming financial year. Keep clear documentation like invoices and receipts.
3. Optimising Deductions through Accruals
If you’ve committed to paying employee bonuses, commissions, or leave by 30 June, you can usually claim a deduction now — even if you pay later. Just ensure you document the obligation in writing. Also review your debtors: if a debt is unlikely to be recovered and you’ve included it as income before, you can write it off. Many businesses forget to review these items each year. It’s also a good time to reassess how you value and report any impaired assets or financial risks.
4. Depreciation and Asset Management
Small businesses can claim an instant deduction for assets costing less than $20,000 if they’re installed and ready for use by 30 June. This includes items like tools, computers, or machinery. Check the asset register and write off any outdated or scrapped items. This not only gives you a tax deduction but also keeps your financials accurate. Regulators like ASIC have made clear they expect proper assessment and documentation of asset values in your 2025 reports.
5. Superannuation Contributions Strategy
To claim a tax deduction on super payments, make sure the money is received by the super fund before 30 June — not just sent. If you use the ATO’s clearing house, process contributions well in advance. The annual limit is $30,000, but you may contribute more using unused caps from the past five years if eligible. High-income earners should watch out for the extra 15% tax on concessional contributions (Division 293). Keep payment evidence and confirmations.
6. Income Deferral Techniques
If you report income on an accrual basis, you may delay issuing invoices for work done near year-end to shift taxable income into the following financial year. If you report income on a cash basis, consider postponing the receipt of large payments until after 30 June. These techniques are legal if commercially reasonable — but ensure you document why the timing makes sense. Be aware that artificial deferrals without commercial substance may attract attention from the ATO.
7. Capital Gains Tax (CGT) Management
If you’ve made capital gains during the year, consider realising capital losses on underperforming assets to reduce your tax. To qualify for the 50% CGT discount, individuals and trusts must have held the asset for more than 12 months. If you're a small business, you might qualify for additional CGT concessions. Avoid artificial transactions like selling an asset and repurchasing it just to trigger a loss — the ATO monitors for this.
8. Effective Trust Distribution Planning
If your business operates through a discretionary trust, review the trust deed and decide on income distributions before 30 June. Distributing income to lower-taxed beneficiaries can reduce overall tax. Ensure the distributions are genuine — the ATO is targeting arrangements where income is assigned to one person but used by another. Make sure resolutions are documented properly and aligned with your trust’s rules.
9. Division 7A Considerations
If your private company has loaned money to shareholders or their associates, you need a formal Division 7A loan agreement and repayments plan to avoid triggering extra tax. For 2024–25, the minimum interest rate is 8.27%. Also check for any unpaid trust distributions (UPEs) to companies, as these may need to be addressed. It's not enough to simply record a repayment — actual transfers must occur and be traceable.
10. Business Restructuring for Tax Efficiency
If your current structure no longer supports your goals (e.g. succession, asset protection, or growth), consider whether a restructure is appropriate. Small businesses can use rollover concessions to shift assets without triggering tax, provided control stays within the family. Also assess whether the restructure affects how liabilities or loans are reported in your accounts. Get advice before acting, as stamp duty and legal implications can arise.
Need help?
For more information, you can download the complete document here.
Contact Eclipse Advisory at [email protected] to plan effectively, meet your reporting obligations, and stay ahead of legislative change.
For best results, engage with our team by 1 June to ensure timely implementation of all year-end strategies.
