The current Australian tax year ends at midnight on 30 June.
This means you have some time left to ensure you’re taking advantage of every opportunity to minimise the amount of tax you’ll owe when you eventually come to submit your 2024/25 tax return.
It’s also a great time to review your wider financial position to check that everything is in order and that you are still on track to meet your objectives.
So, read about six important end of tax year steps you might want to consider to help you manage your tax affairs and to ensure you are in the best financial position possible going into the 2025/26 financial year.
1. Boost your super fund, and save tax at the same time
By making a one-off concessional contribution to your Australian super fund before the end of June 2025, you could save up to 30% in tax, and give your retirement fund a handy boost at the same time.
Such a contribution will usually be taxed at the concessional rate of just 15%. If your income is above $250,000 you will be taxed at 30%.
The concessional contribution limit in 2024/25 is AUD $30,000. Bear in mind that this includes any contributions made by your employer, so you will need to check that you won’t exceed this limit before making any further contributions yourself.
However, if you didn’t maximise your tax-efficient concessional limit in the 2023/24 tax year, you may be able to carry forward any unused concessional contribution from that year and pay it now.
You may also want to think about giving your super fund a further boost by making a voluntary non-concessional contribution (NCC) before the end of this tax year.
The NCC cap is set at four times the current limit on concessional contributions. So, you can pay up to $120,000 into your fund out of your earnings after tax in the 2024/25 tax year.
With all contributions, it’s important to get the timing right. Any contributions must be in your super account before 30 June, or they will be assumed to have been paid in the 2025/26 tax year.
2. Make a tax-efficient super contribution for your spouse
If your spouse or partner is earning a low income, or not working at all, making a contribution into their super fund can be beneficial for you both.
In the 2024/25 tax year, you can claim a tax offset of up to $540 on super contributions that you make on behalf of your spouse or partner.
To qualify for the full offset, you need to contribute $3,000 or more into their super, and they must have an annual salary of less than $37,000.
As well as reducing your tax bill, this will boost their fund, and help equalise your retirement income.
3. Ensure you are making full use of eligible deductions
As part of your end of year planning, it is important to identify all the relevant deductions you can apply for in your tax return that will reduce your assessable income.
For example, if you are one of the growing number of Australians now working from home, you may be able to claim for the cost of day-to-day expenses, such as your internet connection, or heating and air conditioning.
Then, there are other potential deductions specifically related to the work you do. These could include:
- Professional subscriptions
- Travel expenses
- Tools and computer equipment.
It’s worth reviewing all your work-related expenses to see which can be used to reduce your tax liability.
4. Pay 2025/26 expenses in advance to help reduce your taxable income
You can effectively reduce your assessable income for the 2024/25 tax year by prepaying deductible expenses for the 2025/26 tax year before the end of June 2025.
By doing this, you will bring forward the tax deduction into the current tax year.
Some examples of where prepaying expenses in this way could be advantageous for you include:
- Paying any tax accounting fees you’re liable for in advance
- Prepaying 12 months’ interest on any investment loan you may have
- Paying up to 12 months’ worth of premiums on an income protection policy, as long as this is not part of your super arrangement.
5. Consider offsetting a capital gain
If you have realised a gain from any investment during the year, you could consider offsetting this by selling a poorly performing investment that no longer suits your needs.
By selling any such investments, you can crystallise your losses and then set that loss against the gains you may have made.
This would trigger a capital loss, which could reduce your tax payable, as well as potentially release money for new investment opportunities.
Clearly, you should be aware of how this decision aligns with your overall investment strategy, and not simply sell assets for tax purposes.
If you’re in any doubt at all, we’d strongly recommend you take advice from a tax expert.
6. Check that your financial paperwork is kept up to date
By keeping accurate records throughout the tax year, you can keep control of your finances and be in a much better position to take advantage of any tax mitigation opportunities you have had prior to the end of the financial year.
Having all your records in order will also make it easier for you when you come to complete your 2024/25 tax return, and will mean that your return is likely to be accurate with less chance of you making an expensive mistake.
Setting aside a short period when you do this each month can pay dividends in the long run.
It is also worth considering using a professional tax agent or accountant to help you keep your affairs in order.
It’s a good time to review your long-term financial plans
As the financial year draws to a close, it’s a natural time to reflect on your current financial strategy and future goals.
Seeking expert advice can help you make informed decisions and optimise your planning. If you want to discuss your financial planning or any of the issues you’ve read about in this article, please get in touch with us.
Please note
The value of your investment can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance.
This article is for information only, it does not take into account your personal objectives, financial situation, or needs. Please do not solely rely on anything you have read in this article and ensure that you conduct your own research to ensure any actions you may take are suitable for your circumstances.
All contents are based on our understanding of ATO legislation, which is subject to change.