Leenane Templeton – Newcastle Business Accountants, Business Advisors & Financial Planners

Author: Harlan Marriott

  • How to Create a Financial Plan for Your Business for 2025-26 New Financial Year

    How to Create a Financial Plan for Your Business for 2025-26 New Financial Year

    The beginning of the new financial year in Australia, starting July 1, 2025, is more than just a date on the calendar—it’s a strategic milestone for business owners. Whether you’re running a small local service or scaling a national e-commerce brand, having a clear, actionable financial plan is crucial for making smarter decisions, weathering uncertainties, and growing sustainably.

    Too often, small businesses operate on instinct or gut feeling, only to find themselves unprepared for cash shortages, tax surprises, or missed growth opportunities. But with a well-thought-out financial plan, you gain clarity, control, and confidence. This guide walks you through the essential steps to build a financial plan that’s tailored for your 2025–26 business journey. Let’s dig in.

    Step 1: Revisit Your Business Vision and Long-Term Goals
    Before diving into numbers and spreadsheets, take a step back. What is the core vision of your business? Where do you want it to be in 1 year, 3 years, or 5 years? Financial planning isn’t just about crunching numbers—it’s about aligning your finances with your broader business goals.

    Ask yourself:

    • Are you aiming to expand to new locations?
    • Planning to invest in new equipment or tech?
    • Wanting to increase your market share or launch new products?
    • Hoping to build a more stable income stream and reduce debt?

    Write down these goals in concrete, measurable terms. Then, assign realistic timelines and potential financial impact to each. This forms the foundation for your financial decisions—your cash allocation, investments, pricing, and hiring will all tie back to these objectives.

    Remember, clarity of vision leads to smarter execution. Don’t skip this foundational step.

    Step 2: Conduct a Full Financial Health Check
    Think of this as your business’s annual check-up. Review the key financial documents from the past 12 months—your income statement, balance sheet, and cash flow statement. These aren’t just accounting formalities; they tell the story of your business’s performance.

    Here’s what to look for:

    • Profitability: Was your net profit margin healthy? Are there areas where margins are shrinking?
    • Liquidity: Do you have enough current assets to cover short-term liabilities?
    • Cash Flow: Were there periods where you struggled to pay suppliers or wages?
    • Debts: What’s your current debt load, and how manageable is it with your income?

    Highlight strengths you can build on and weaknesses that need addressing. Maybe you’re generating strong sales but bleeding cash due to late receivables or overspending. Or perhaps you have steady cash flow but haven’t optimised your margins.

    This financial reflection sets the stage for your 2025–26 goals. It also alerts you to areas where you’ll need to make strategic changes.

    Step 3: Forecast Your Revenue and Expenses
    Forecasting might sound intimidating, but it’s really just educated guessing based on past trends and future plans. Start by estimating your expected revenue month by month. Break it down by product or service line, if applicable.

    Use:

    • Previous years’ revenue as a baseline
    • Seasonal trends (e.g., higher retail sales during Christmas)
    • New client contracts or marketing campaigns launching soon
    • Pricing adjustments or product changes

    Next, do the same for expenses. Separate fixed costs (rent, wages, insurance) from variable ones (inventory, commissions, travel). Factor in any anticipated increases, such as rising supplier prices or plans to hire.

    Tip: Don’t forget one-off expenses—equipment upgrades, website redesigns, or training programs. These can derail a plan if not accounted for early.

    The result is a month-by-month financial picture for 2025–26. It won’t be 100% accurate, but it will help you plan proactively, not reactively.

    Step 4: Build a Cash Flow Projection
    Cash flow is the heartbeat of your business. Even profitable businesses fail when they can’t manage cash effectively. Your financial plan must include a detailed cash flow forecast—tracking when money enters and leaves your business.

    Here’s how:

    • Start with your opening bank balance for July 2025.
    • Add expected cash inflows (sales, loan drawdowns, tax refunds).
    • Subtract projected outflows (rent, payroll, loan repayments, BAS).

    Do this monthly or even weekly if your cash flow is tight. Use a spreadsheet or accounting software like Xero, QuickBooks, or MYOB to automate the process.

    Why this matters: You might invoice $50,000 in July, but if your clients don’t pay until September, you could be short on funds to pay suppliers in August. A cash flow forecast helps you prepare for these gaps—whether that’s arranging an overdraft, adjusting payment terms, or timing expenses better.

    Step 5: Plan for Taxes and Superannuation
    This is one area many business owners overlook—until it bites back hard. From GST to PAYG withholding, company tax to superannuation, every dollar owed to the ATO needs to be budgeted for in advance.

    Here’s what to include:

    • Quarterly BAS: Estimate your GST and PAYG obligations and set that money aside.
    • Income Tax: Based on your profit forecast, calculate your likely income tax liability. Consider if you’ll need to pay instalments (PAYG Instalments).
    • Super Contributions: Budget for the Super Guarantee (currently 12% for employees from July 1, 2025) and any voluntary contributions if you’re self-employed.

    Open a separate tax savings account and move a portion of revenue into it regularly. It might feel painful, but it saves you from scrambling during tax season or getting hit with penalties.

    Step 6: Review and Update Pricing Strategies
    Pricing isn’t set-and-forget. It’s one of the most powerful tools to impact your bottom line, yet many business owners haven’t adjusted their prices in years. In 2025-26, inflation, supply chain pressures, and changing customer behaviours all make it critical to reassess your pricing.

    Here’s what to do:

    • Benchmark against competitors: Are you undercharging compared to similar businesses? Or are you at a premium that’s not backed by additional value?
    • Calculate your cost base: Have supplier costs, shipping, labour, or overheads increased? If so, your prices should reflect that.
    • Assess your value proposition: Are you offering more than before—better service, quicker delivery, enhanced features? Price accordingly.

    Even a 5-10% increase in pricing, if communicated correctly, can significantly boost profitability without hurting customer loyalty. Consider bundling services, offering value-based pricing, or providing subscription models to encourage recurring revenue.

    Your financial plan should reflect any anticipated price changes and model how they impact your revenue and profit targets.

    Step 7: Identify Investment and Growth Opportunities
    A strong financial plan isn’t just about cutting costs—it’s also about planning for expansion and innovation. What can you invest in this year that could lead to stronger revenue or efficiency in the future?

    Potential areas for investment:

    • Technology: CRM systems, e-commerce upgrades, automation tools
    • Marketing: Paid campaigns, SEO, branding, influencer partnerships
    • Talent: Hiring staff to free up your time or scale delivery
    • New Products or Services: Based on customer feedback or industry trends

    Use your financial plan to model different investment scenarios. For example, what happens to your cash flow if you spend $10,000 on a rebrand or new hire? What ROI do you expect?

    Every growth plan involves risk, but the key is planning. Forecast the potential upside, build in a buffer, and ensure your cash position supports your ambition.

    Step 8: Create a Budget for 2025-26
    A budget is the practical side of your financial plan—it’s where strategy meets execution. Based on your forecasts and goals, build a detailed budget broken down monthly and by category.

    Key elements:

    • Revenue targets by product/service or location
    • Fixed costs like rent, wages, insurance
    • Variable costs like marketing, inventory, subcontractors
    • Discretionary spending for training, events, travel
    • Planned investments or upgrades
    • Loan repayments and tax reserves

    Use accounting software to track budget vs actuals monthly. This allows you to course-correct if revenue dips or expenses spike unexpectedly. Your budget should be a living document—review it quarterly and adjust based on performance.

    A solid budget not only guides spending but gives you the confidence to take calculated risks when the time is right.

    Step 9: Monitor Your KPIs and Performance Metrics
    Numbers are only useful if you measure and act on them. Your financial plan should include a clear set of Key Performance Indicators (KPIs) that you’ll track throughout the year.

    Common KPIs include:

    • Gross profit margin
    • Net profit margin
    • Customer acquisition cost
    • Revenue per employee
    • Inventory turnover
    • Accounts receivable days
    • Operating cash flow

    Choose KPIs that align with your goals. If growth is the focus, track sales conversion rates and marketing ROI. If efficiency is the priority, monitor labour costs or workflow cycle time.

    Set monthly or quarterly targets, and use a dashboard (or just a spreadsheet) to visualise progress. If something’s off track, investigate and adjust early. Waiting until year-end is too late.

    Step 10: Build in a Contingency Plan
    No matter how good your financial planning is, curveballs happen—economic shifts, supply chain breakdowns, new competition, or personal emergencies. That’s why every solid plan includes a contingency fund and risk strategy.

    Start by identifying potential risks:

    • What if your biggest client leaves?
    • What if interest rates rise again?
    • What if staff turnover increases?

    Then, model worst-case scenarios. How would these impact cash flow, and what steps could you take? Could you delay investments, cut costs, or tap into reserves?

    Aim to have a minimum of 3 months’ worth of operating expenses in a separate emergency fund. This buffer gives you time to adapt without panic.

    Also, revisit your business insurance. Is it up to date and adequate for new equipment, locations, or team members? Consider business interruption cover, cyber insurance, and professional indemnity based on your industry.

    Planning for the worst helps ensure the best isn’t derailed.

    Step 11: Use Financial Tools and Technology
    Manual spreadsheets have their place, but in today’s fast-moving world, digital tools can dramatically improve accuracy, save time, and offer deeper insights into your financial planning.

    Start with cloud-based accounting software (LT has experts to help) like:

    • Xero: Ideal for small to medium Australian businesses, integrates with BAS, payroll, and cash flow forecasting.
    • QuickBooks Online: Great for multi-user environments and real-time financial dashboards.
    • MYOB: Tailored for Australian tax and compliance requirements, with strong reporting features.

    Then add budgeting, forecasting, and KPI tracking tools like:

    • Fathom or Float: Visual cash flow forecasting.
    • LivePlan: Strategic business planning and pitch development.
    • Trello/Asana: For task and milestone tracking alongside your financial goals.

    Use bank feeds, automated invoicing, and payment integrations to reduce human error and save time. The goal is real-time financial clarity, not a month-late report.

    Also consider apps for expense tracking (like Expensify), receipt scanning (like Hubdoc), and inventory management if you sell products. With the right tech stack, you’re no longer reacting—you’re steering the ship.

    Step 12: Consult with your LT Business Accountant or Financial Advisor
    Even the most hands-on business owner needs outside perspective. Using one of Leenane Templeton’s Chartered Accountants, tax advisors or financial advisor can offer valuable insights, identify blind spots, and ensure your plan complies with current regulations.

    Here’s what we can help with:

    • Structuring your business for tax efficiency
    • Forecasting complex cash flow and tax obligations
    • Reviewing your plan for missed deductions or risks
    • Setting realistic targets based on industry benchmarks
    • Planning for succession, exit, or capital raising

    Schedule an annual or semi-annual financial planning session. Come prepared with your goals, forecasts, and current numbers. We don’t just crunch numbers— we help you strategise and grow.

    The small investment in advice can lead to thousands in savings or extra revenue. Don’t treat it as a cost—see it as part of your business toolset.

    Conclusion
    Creating a financial plan for the 2025–26 financial year isn’t just a best practice—it’s a necessity in today’s economic climate. With rising costs, tightening regulations, and ever-evolving markets, flying blind is no longer an option for Australian business owners.

    By taking the time now to revisit your goals, forecast your cash flow, review your pricing, and prepare for contingencies, you’re not just planning—you’re leading. Your financial plan is your business blueprint for the next 12 months, guiding every dollar, decision, and direction.

    The best part? You don’t need to be a finance expert to take control—you just need clarity, consistency, and the right tools. Start today, and by next June, you’ll not only survive—you’ll thrive.

    LT’s FAQs
    How often should I review my financial plan?
    Ideally, you should review your financial plan quarterly. At the very least, revisit it mid-year and at the end of the financial year to adjust for market changes or new opportunities.

    What’s the difference between a financial plan and a budget?
    A budget is a short-term, detailed projection of revenue and expenses. A financial plan is broader, covering strategy, goals, cash flow, risk management, and growth.

    Should I include debt repayments in my financial plan?
    Absolutely. Debt repayments impact your cash flow and financial risk profile. Include all loans, credit lines, and interest payments in your forecast.

    How do I plan for unexpected costs?
    Create a contingency fund with at least 3 months’ operating expenses. Also, build in 5–10% flexibility in your budget for price hikes or emergencies.

    Is hiring a financial / business advisor worth it for small businesses?
    Yes—especially if your business is growing, your finances are complex, or you’re making major decisions. A good advisor can help you save on taxes, avoid risk, and uncover opportunities you might miss alone.

    Need help? Chat with one of Leenane Templeton’s advisors today. Contact Us

  • Updating Your Business Plan – A Reset, Refresh & Restart In The New Financial Year

    Updating Your Business Plan – A Reset, Refresh & Restart In The New Financial Year

    A new financial year is more than just ticking compliance boxes—it’s a strategic opportunity to reflect, reset, and reposition your business for the year ahead. One of the most valuable tools you can leverage during this time is an up-to-date business plan.

    While many businesses set a plan when starting out, it’s easy to let it sit on the shelf untouched. However, market conditions, customer behaviour, economic forecasts, and business priorities can shift significantly from year to year. Reviewing and updating your business plan annually ensures you stay agile, focused, and ready to tackle upcoming challenges and opportunities.

    (1) Start with a Business Health Check
    Look at how your business performed over the last 12 months. Were your financial goals met? Did your products or services evolve? Are your customers still the same—or has your ideal audience changed?
    Assess your key financials, such as profit margins, expenses, and cash flow. This insight will help you understand whether your previous plan is still aligned with your actual business performance and growth trajectory.

    (2) Update Goals and KPIs
    Your goals may need to evolve in response to internal and external shifts. Perhaps you’re aiming to expand into new markets, increase your digital presence, or improve operational efficiency.
    Set clear, measurable targets for the coming year, and align them with your team’s performance indicators. These benchmarks will help you track progress and stay accountable throughout the year.

    (3) Adapt to Changing Market Conditions
    Take the time to research current trends in your industry, economic conditions, and any regulatory changes that may affect your operations. Consider how your customers’ needs and expectations might shift in the year ahead.
    Updating your marketing and sales strategy to reflect these changes is key to staying competitive and relevant.

    (4) Review Your Budget and Forecasts
    An updated business plan should include revised financial forecasts and budgets. Factor in anticipated expenses, new revenue streams, and any potential risks. If you’re planning on investing in new equipment, hiring staff, or launching a new product, make sure these plans are reflected in your financial projections.

    Working with your accountant during this phase can help you create realistic and strategic financial goals that support sustainable growth.

    (5) Strengthen Your Operational Framework
    Review your internal processes and systems. Are they still serving your business well, or are there areas where efficiency can be improved? Consider technology upgrades, staff training needs, or outsourced services that could free up your time and increase productivity.

    Ready for the Year Ahead?
    Updating your business plan doesn’t have to be an overwhelming task—it’s about keeping your vision current and actionable. A well-crafted, regularly reviewed plan becomes your roadmap, helping you steer confidently through the year.

    Need support reviewing your financials or setting targets for the year ahead? At Leenane Templeton we’re here to help you get clarity, confidence, and control over your business direction. Let’s make this new financial year your most successful yet. Contact your business accountant at LT

    Disclaimer
    The information contained in this publication is for general information purposes only, professional advice should be obtained before acting on any information contained herein. Neither the publishers nor the distributors can accept any responsibility for loss occasioned to any person as a result of action taken or refrained from in consequence of the contents of this publication.

  • Top 10 Financial Habits to Start the New Financial Year Strong (2025-26 Edition)

    Top 10 Financial Habits to Start the New Financial Year Strong (2025-26 Edition)

    The start of a new financial year in Australia, beginning July 1, is a golden opportunity to reset, refocus, and take charge of your financial life. Just like a New Year’s resolution for your wallet, it’s the perfect time to shake off any bad money habits and build stronger, more secure ones.

    Whether you’re a seasoned investor or just trying to stop living paycheck to paycheck, adopting solid financial habits early in the financial year can set the tone for the next 12 months. This guide will walk you through ten impactful financial habits that can boost your savings, cut unnecessary costs, improve your credit score, and prepare you for long-term success

    Think of your finances as a garden — neglect it, and weeds will grow. But with consistent care, planning, and smart decisions, it can flourish. Let’s dive into the top financial habits you need to make 2025-26 your best financial year yet.

    Habit 1: Review and Reset Your Financial Goals
    Start the new financial year with intention. Ask yourself: what do I want to achieve financially in the next 12 months? Maybe it’s saving for a house deposit, paying off a credit card, investing in the stock market, or simply building an emergency fund.

    Begin by reviewing your previous financial year. Did you meet your goals? If not, why? Be brutally honest here — maybe you underestimated your expenses, didn’t track your spending, or life simply threw curveballs.

    Once you’ve reflected, it’s time to reset. Write down SMART goals — Specific, Measurable, Achievable, Relevant, and Time-bound. For instance:

    • “Save $10,000 for a home deposit by June 2026.”
    • “Clear $5,000 of credit card debt by December 2025.”
    • “Invest $200 monthly into a diversified ETF portfolio.”

    Don’t just think about big goals. Break them into monthly or even weekly milestones. Set calendar reminders. Visualise your progress using apps or charts. This clarity not only motivates you but also holds you accountable.

    Habit 2: Create a Fresh, Realistic Budget
    A budget isn’t about restricting yourself — it’s about giving every dollar a job. At the start of the financial year, build a fresh budget that reflects your current income, expenses, lifestyle changes, and new financial goals.

    First, track your spending for the last 3-6 months. Look through your bank statements or use budgeting apps to categorise where your money went. You might be surprised at how much you’re spending on takeout or subscriptions you forgot about.

    Then, choose a budgeting method that works for you:

    • 50/30/20 Rule (50% needs, 30% wants, 20% savings)
    • Zero-based Budgeting (every dollar is allocated)
    • Envelope System (great for cash users)

    Factor in irregular expenses like car rego, birthdays, holidays, and back-to-school costs. Build sinking funds for them. Set boundaries on discretionary categories like dining out or online shopping.

    A realistic budget is flexible. Review and adjust it monthly, especially after big life changes. With the right plan, you’ll not only stop overspending — you’ll start building momentum.

    Habit 3: Track Every Dollar You Spend
    It’s shocking how quickly a $5 coffee here and a $20 lunch there can drain your account. That’s why tracking your spending is a game-changer. It helps you spot leaks in your budget, change behaviour, and feel more in control of your money.

    Start simple: Use a Google Sheet or budget planner notebook or discover many of the online apps available.

    Be consistent — daily or weekly tracking is best. Categorise everything: groceries, petrol, entertainment, bills, kids’ expenses. Watch out for:

    • Subscription traps
    • Impulse purchases
    • ATM withdrawals with no trace

    Over time, this habit rewires how you think about money. It’s like a fitness tracker for your bank account — the more awareness you build, the smarter choices you’ll make.

    Habit 4: Prioritise Debt Repayment Strategically
    Debt is like a leaky bucket — you can’t fill it if it’s constantly draining. If you’re carrying high-interest debts, especially credit cards or payday loans, the start of the financial year is the moment to tackle them aggressively.

    Use one of these proven methods:

    Debt Avalanche: Pay off debts from highest to lowest interest rate. You’ll save more in interest.

    Debt Snowball: Pay off the smallest balances first. You’ll see quicker wins and build motivation.

    List out all your debts: balance, minimum repayment, interest rate. Add them to your budget. Automate repayments where possible to avoid late fees. Use lump sums like tax refunds or bonuses to knock down balances.

    Also, consider consolidating multiple debts into a personal loan with a lower interest rate. Just make sure it doesn’t extend the repayment term too far or carry high fees.

    And here’s the golden rule — stop accumulating new debt. Leave credit cards at home, or freeze them digitally if you must. The freedom of being debt-free is worth the discipline.

    Habit 5: Automate Your Savings and Investments
    Automation is the ultimate financial hack. When you automate savings and investments, you’re paying yourself first — before lifestyle creep eats into your income. It removes willpower from the equation and builds wealth quietly in the background.

    Start by setting up automatic transfers from your everyday account to a high-interest savings account the day after payday. Treat it like a non-negotiable bill.

    Set goals:

    • Emergency fund (3–6 months of living expenses)
    • Travel or holiday fund
    • House deposit
    • Investment account

    Want to start investing? Auto-invest small amounts into diversified portfolios or ETFs. Set a recurring transfer — even $50 a week adds up over time.

    Automate super contributions too if you’re self-employed. And don’t forget about micro-investing apps if you’re a beginner.

    By the time you check again in a few months, you’ll have built a nice little nest egg — without feeling the pinch.

    Habit 6: Review Your Superannuation Performance
    Superannuation is one of the most important yet most neglected parts of your long-term financial strategy. If you’re like most Australians, you might not have checked your super in months — or even years. But July is the perfect time to get reacquainted with your retirement savings.

    Start by logging into your MyGov account and linking it to the ATO to view all your super accounts. Many people have multiple super funds floating around from previous jobs. If that’s you, consider consolidating them to avoid duplicate fees (but always check if you’ll lose insurance benefits before merging).

    Next, review the performance of your current super fund. Compare its returns over the past 5 and 10 years against industry averages using comparison sites like Canstar or SuperRatings. If your fund has been underperforming or charging high fees, it may be time to switch.

    Also, review your investment strategy within your fund — are you in a default, conservative, or aggressive portfolio? The younger you are, the more risk you can typically take for higher growth over time. Lastly, boost your super with voluntary contributions. Even $20 a week adds up — and you may qualify for government co-contributions or tax benefits.

    Super might not feel urgent today, but your future self will thank you.

    Habit 7: Check Your Credit Report and Improve Your Score
    Your credit score plays a huge role in your financial future. It affects whether you’re approved for loans, credit cards, even rental applications. And yet, many Australians don’t even know their score, let alone how to improve it.

    At the start of the financial year, take 10 minutes to request a free credit report from services that are available.

    Once you have it, check for:

    • Incorrect details (like wrong addresses or duplicate accounts)
    • Accounts you didn’t open (could indicate identity theft)
    • Late payments or defaults
    • Your credit limit and usage

    If you spot errors, contact the credit provider immediately to dispute them. Even small fixes can boost your score.

    To improve your score moving forward:

    • Always pay bills and loans on time
    • Keep credit card balances low
    • Avoid unnecessary applications for credit
    • Maintain a good credit history over time

    A good credit score can save you thousands in interest when applying for a home loan or car finance — it’s like your financial passport, so keep it clean.

    Buy Now Pay Later – BNPL

    As of 10 June 2025, Buy Now Pay Later (BNPL) services in Australia are now officially treated as credit products—meaning providers must hold a credit licence and play by the same rules as traditional lenders. One key change is the introduction of mandatory credit checks, which may show up on your credit report and affect your credit score. Some providers may also start reporting your repayment history, so if you miss a payment, it could leave a mark. On the flip side, managing your repayments well might actually help your score over time. The aim of these changes is to make lending more responsible and ensure you’re only borrowing what you can afford. So if you’re a regular BNPL user, it’s a good time to check in on your spending habits and be aware of how these services could shape your financial future.

    Habit 8: Update Your Insurance Policies
    Insurance isn’t the most exciting topic, but it’s one of the most essential. As your life changes — new job, family, home, health — your insurance needs evolve too. The beginning of the financial year is a great time to review and update all your policies.

    Start with health insurance. Check if your plan still suits your medical needs, especially if you’ve had major changes like surgery, pregnancy, or starting a family. Compare providers using websites like Compare the Market or iSelect to potentially find better coverage or lower premiums.

    Next, review your life insurance, income protection, and total permanent disability (TPD) coverage. These often sit inside your super, so log into your fund and see what you’re covered for. You may find you’re underinsured — or paying too much for unnecessary extras.

    Don’t forget home, contents, car, and pet insurance. Update your asset valuations, especially if you’ve bought new tech, jewellery, or furniture. Check if your policy includes flood cover or new car replacement.

    Set reminders to shop around each year before renewal — loyalty rarely pays in the insurance world. Being proactive with insurance is like wearing a seatbelt: you may not need it every day, but it’s vital when things go wrong.

    Habit 9: Maximise Your Tax Position Early
    Most people scramble at tax time, but smart money movers start preparing their tax strategy on day one of the financial year. That’s because the biggest tax savings come from consistent planning, not last-minute paperwork.

    Begin by understanding which deductions you’re eligible for. If you’re working from home, you may claim a portion of utilities, internet, phone, office equipment, and even occupancy costs depending on your arrangement. If you’re a sole trader or side hustler, keep track of business expenses from July 1 onwards.

    Log every deductible expense with a receipt-tracking app like ATO myDeductions or other apps. Keep a dedicated email folder for tax receipts and store everything digitally. It’ll save hours next June.

    Also, consider tax-effective strategies:

    • Salary sacrifice into super
    • Prepaying deductible expenses (e.g. insurance, interest)
    • Donating to charities for a tax offset

    Engage a tax accountant early if your finances are complex — they’ll help plan for next EOFY, not just react to the one that’s passed. By planning early, you’ll minimise tax stress and potentially score a bigger refund.

    Habit 10: Educate Yourself Financially – Continuously
    Your financial health is only as strong as your knowledge. And in a world full of money myths and bad advice on social media, staying educated is more important than ever. Luckily, learning about finance has never been more accessible — or more fun.

    Kick off the financial year by committing to regular financial education. Read one personal finance book a month (like The Barefoot Investor or Money School). Subscribe to podcasts like She’s on the Money, Equity Mates, or My Millennial Money during your commute. Follow credible finance experts on YouTube, LinkedIn, or even TikTok — just ensure they’re licensed and transparent.

    If you’re ready to level up, take a free or low-cost online course on budgeting, investing, tax, or retirement planning. Platforms like Coursera, Udemy, or even your super fund may offer resources.

    Set a 12-month learning goal. Maybe you want to understand ETFs, learn how to flip a side hustle into a business, or master the art of negotiation.

    Knowledge compounds like interest — the more you learn, the better your decisions. And over time, that turns into real wealth.

    Conclusion
    The new financial year isn’t just about numbers — it’s about mindset. It’s a chance to draw a line in the sand, clean up old money habits, and replace them with ones that move you closer to the life you want. You don’t have to be perfect, but you do need to be consistent.

    Adopt just a few of these habits, and by next June, you won’t recognise your finances — in the best possible way. So start today. Your future self will be glad you did.

    FAQs
    What’s the best financial habit to start with?
    Start by tracking your spending. It gives you instant awareness and reveals where your money leaks are.

    How do I make my financial habits stick long-term?
    Create systems, not willpower-based routines. Automate everything and set calendar reminders for reviews.

    Should I speak to a financial advisor each new year?
    If your finances are complex, yes. Otherwise, doing a personal finance audit yourself is a great first step.

    How often should I review my financial goals?
    Quarterly is ideal. Things change fast — make sure your goals still align with your life.

    Can these habits help with wealth building over time?
    Absolutely. These aren’t just habits — they’re stepping stones to long-term financial independence.

    Disclaimer
    The information contained in this publication is for general information purposes only, professional advice should be obtained before acting on any information contained herein. Leenane Templeton does not recommend any of the apps mentioned nor is affiliated with them in anyway they are just an example of what is available. Neither the publishers nor the distributors can accept any responsibility for loss occasioned to any person as a result of action taken or refrained from in consequence of the contents of this publication.

  • New Car Thresholds from 1 July: What Small Business Owners Should Know

    New Car Thresholds from 1 July: What Small Business Owners Should Know

    If you’re considering purchasing a vehicle for your business, it’s important to be aware of the updated car thresholds taking effect from 1 July 2025.

    Each financial year, the Australian Taxation Office (ATO) reviews and adjusts these thresholds to reflect inflation and economic conditions, and they directly impact how much you can claim for your vehicle purchase.

    Here’s a breakdown of the new thresholds and what they mean for your business.

    1 – Car Depreciation Limit
    From 1 July 2025, the car limit for depreciation will increase to $69,674. This is the maximum value that can be used to calculate the decline in value (depreciation) for eligible motor vehicles used in business.

    If you purchase a passenger vehicle for your business that costs more than this amount, you can only claim depreciation up to $69,674. Any portion of the cost above this limit isn’t deductible for tax purposes.

    This limit applies to most standard passenger vehicles designed to carry less than one tonne and fewer than nine passengers. It includes sedans, hatchbacks, and SUVs that meet these criteria.

    2 – Luxury Car Tax (LCT) Thresholds
    The Luxury Car Tax (LCT) thresholds are also changing:
    • Fuel-efficient vehicles: The threshold rises to $91,387
    • Other vehicles: The threshold rises to $80,567
    LCT applies to the GST-inclusive value of a car above these thresholds. Fuel-efficient vehicles (those that consume no more than 7 litres per 100km combined) attract a higher threshold, providing a little extra room before the tax kicks in.

    Planning Ahead
    If you’re planning to buy a car for your business, it’s wise to consider how these changes may affect your budget and tax position. For example, purchasing a vehicle just before or after 1 July could alter the amount you can claim.

    Also, bear in mind that commercial vehicles such as utes or vans designed to carry heavier loads may fall outside of these car limit rules, depending on their specifications and how they’re used.

    What You Should Do Next
    Before you make any vehicle purchases, it’s a good idea to speak with your accountant or adviser. We can help you:
    • Determine whether the vehicle you’re looking at is eligible for a deduction
    • Understand the fringe benefits tax (FBT) implications if there’s any personal use
    • Ensure your records are in order for a smooth claim come tax time
    With these new thresholds in mind, a little planning can go a long way in making sure your next vehicle purchase is both practical and tax-smart.

    If you’d like to discuss how this change may impact your business or explore other tax-effective strategies, get in touch with Leenane Templeton, as we’re here to help.

    Disclaimer
    The information contained in this publication is for general information purposes only, professional advice should be obtained before acting on any information contained herein. Neither the publishers nor the distributors can accept any responsibility for loss occasioned to any person as a result of action taken or refrained from in consequence of the contents of this publication.

  • Super Tips for Sole Traders and Partnerships Before EOFY

    Super Tips for Sole Traders and Partnerships Before EOFY

    If you’re self-employed—whether you run your own business as a sole trader or operate within a partnership – you’re probably used to wearing many hats.

    From managing clients and keeping up with invoices to handling tax obligations, the to-do list never seems to end. But as we approach the end of the financial year (EOFY), one important thing that’s easy to overlook is your superannuation.

    Unlike employers, self-employed individuals aren’t legally required to contribute to super for themselves. That said, it’s a smart move to think ahead and give your retirement savings a little attention. Not only can it help you down the track, but it might also bring some handy tax advantages in the short term.

    Why Make Super Contributions?
    Making voluntary super contributions is one way to look after your future while potentially reducing your current tax bill. You can contribute from your after-tax income and – if you lodge the right form with your super fund – claim the contribution as a tax deduction. This lowers your taxable income and grows your super at the same time. Win-win!

    Just keep in mind that if you claim the contribution as a tax deduction, you won’t be eligible for the government’s super co-contribution (more on that below).

    What’s the Government Co-Contribution?
    If you’re a low or middle-income earner and you make a non-deducted personal super contribution, you could be eligible for a government co-contribution. The government may contribute up to $500 into your super—no strings attached. The best part? You don’t even have to apply. The Australian Taxation Office (ATO) will assess your eligibility automatically when you lodge your tax return.

    It’s a great incentive if you’re in a position to make a small personal contribution and don’t plan to claim it as a tax deduction.

    What Should You Do Before June 30?
    As EOFY approaches, now’s the perfect time to check your super is in order. Here are a few helpful tips:
    • Make contributions early: Super funds need to receive your contribution before June 30 (or the last business day before it) for it to count in this financial year. Transfers can take a few days—so don’t leave it to the last minute.
    • Be aware of caps: There are annual limits on how much you can contribute to your super. Going over these caps can result in extra tax, so it’s good to keep track.
    • Check that your super fund has your Tax File Number (TFN): If they don’t, your contributions might be taxed at a higher rate and you could miss out on things like government co-contributions.
    • Keep records: Hang on to contribution receipts and any correspondence with your super fund—especially if you’re planning to claim a deduction in your tax return.

    Looking Ahead
    Super might not feel urgent today, especially when your focus is on running your business. But a little effort now can go a long way toward building a more comfortable future. EOFY is the ideal time to pause, plan, and make sure your super is working for you.

    If you’re unsure about how much to contribute or what’s best for your circumstances, don’t hesitate to reach out to your licensed accountant or financial advisor.

    A quick chat could help you make smarter decisions – for this EOFY and beyond.

    Disclaimer
    The information contained in this publication is for general information purposes only, professional advice should be obtained before acting on any information contained herein. Neither the publishers nor the distributors can accept any responsibility for loss occasioned to any person as a result of action taken or refrained from in consequence of the contents of this publication.

  • How to Minimise Your 2025 Business Tax in Australia: A Practical Guide for Business Owners

    How to Minimise Your 2025 Business Tax in Australia: A Practical Guide for Business Owners

    Why Tax Planning Matters More Than Ever in 2025

    The end of the financial year can feel like a sprint to the finish for most business owners. But what if we told you it could also be an opportunity—an opening to keep more of your hard-earned money in your business and pocket? That’s exactly what effective tax planning allows you to do. As we move through 2025, with evolving tax rules and economic uncertainties, taking control of your tax outcomes is not just wise—it’s essential.

    The core of tax planning isn’t about dodging taxes; it’s about managing them smartly. Strategic moves can reduce your taxable income, bring forward deductions, and delay income, effectively lightening the load when tax time comes. And when you do it right, those savings don’t just sit idle—they can be reinvested in ways that improve your lifestyle or business.

    What could you do with extra money saved on tax? A lot. You could reduce your home loan, put more into your superannuation, finally plan that much-needed holiday, invest in property, fund your kids’ education, or upgrade your car. When you have a plan, the possibilities multiply.

    Moreover, the Australian Taxation Office (ATO) is sharpening its focus on compliance and targeting areas where business owners are likely to slip up. With increased scrutiny and audit risks, being proactive—not reactive—is how you stay ahead of the curve.

    Is Your Business a “Small Business Entity”?

    If you’re running a business in Australia, one of the first things you should assess is whether you qualify as a “Small Business Entity” (SBE). This classification opens the door to a variety of tax concessions, but not everyone knows the exact criteria—or how to make the most of it.

    Under the current guidelines, your business is considered a small business if it has an aggregated turnover of less than $10 million. This figure includes your turnover as well as that of any businesses you’re affiliated with or control. It’s not just about your standalone income; it’s the combined power of all your connections.

    What makes this classification so valuable? For starters, it allows you to access simplified depreciation rules, such as instant asset write-offs. These can let you deduct the full cost of eligible assets immediately under $20,000, rather than depreciating them over time. You can also access concessional capital gains tax (CGT) treatment, simplified trading stock rules, and more flexible prepayment deduction options.

    However, it’s not a once-and-done assessment. Your status can change year to year, depending on your financial performance and how your business is structured. So, it’s important to assess your eligibility annually and adjust your strategies accordingly.

    Take Advantage of Lower Company Tax Rates

    One of the most straightforward ways to reduce your business tax is to ensure you’re leveraging the appropriate company tax rate. In the 2025 financial year, companies with an aggregated turnover of less than $50 million are eligible for a reduced tax rate of 25%. But there’s a catch: at least 80% of your income must be “active” rather than “passive.” That means revenue should come from actual business operations—not from investments like dividends, rent, or capital gains.

    But what if you’re using a trust structure instead of a company? Here’s where things get interesting. You can allocate profits from your trust to what’s known as a “Bucket Company.” This company must meet the base rate entity criteria to qualify for the 25% tax rate. By routing profits through this company, you effectively cap your tax liability at a lower rate compared to distributing them directly to individuals, who might be taxed at higher marginal rates.

    This strategy needs to be implemented with care. Your bucket company must genuinely qualify for the lower rate, and the distributions need to be properly documented and legally compliant. Done right, it’s a powerful way to lock in tax savings while retaining earnings in a corporate environment for future investment.

    Watch Out for the Tax Sting from Asset Sales

    Remember those shiny new business assets you were able to deduct in full under temporary full expensing or instant asset write-off rules? Well, they may come back to bite when you sell them.

    Here’s the deal: assets you previously wrote off at 100% don’t just disappear from your financial statements. When you eventually sell them, the proceeds from the sale become assessable income. That means if you get $10,000 from selling a vehicle that was fully expensed, that full \$10,000 goes into your income for the year of sale.

    And here’s the kicker: if you buy a replacement asset over $20,000, you can no longer write it off instantly under the current rules. Instead, you’ll need to depreciate it over its useful life. This change can create a mismatch in deductions and income, potentially leading to a higher tax bill than expected.

    The key is planning. If you anticipate needing to upgrade or sell assets, coordinate the timing to balance the income from the sale with new deductions or other offsets. Don’t let the taxman catch you off guard with a sting that could have been managed with foresight.

    Maximise Your Superannuation Contributions

    Superannuation isn’t just a retirement tool—it’s one of the most tax-efficient investment vehicles available in Australia. The 2025 concessional contribution cap is $30,000. That’s a golden opportunity to tuck away a substantial sum and lower your taxable income at the same time.

    But timing is everything. Contributions need to be received by your super fund or the Small Business Superannuation Clearing House (SBSCH) by 30 June 2025 to be deductible in this financial year. That means no last-minute transfers, no cutting it close with banking delays. Get it in early and avoid the stress.

    Also, keep in mind that any super contributions you make as an employer—like Super Guarantee payments—count toward this cap. If you go over, the excess amount is taxed at your marginal rate and comes with additional penalties. So, track your contributions carefully and plan strategically.

    And if you’ve had a few years of low or no contributions, you might even be able to tap into the carry-forward provisions that allow you to use unused cap amounts from previous years. It’s a win-win: you save on tax today and invest in your future.

    Invest in Tools of Trade and FBT Exempt Items

    Thinking of upgrading your gear or buying tools for your business? Do it smartly and score some tax advantages while you’re at it. The ATO allows business owners and their employees to purchase certain “Tools of Trade” and other work-related items without attracting Fringe Benefits Tax (FBT). But here’s the catch—you need to structure it correctly and make the purchase before 30 June 2025.

    What qualifies? Quite a lot actually. Think of portable electronic devices like laptops, tablets, mobile phones, and personal digital assistants. You can also include software, protective clothing, briefcases, and even digital cameras. If it’s used primarily for work, it could be FBT exempt.

    Here’s how it works: your business reimburses you (or your employee) for purchasing the item. You get the equipment, and your employer claims a deduction on the cost and any GST input credits. Meanwhile, your salary package is only reduced by the GST-exclusive price. It’s a win-win, as long as everything is correctly documented and the items are used mainly for work.

    This is a fantastic way to modernise your work setup without blowing your budget. But remember—eligibility and benefit calculations can get tricky. So, it’s best to consult your accountant to ensure you’re meeting the ATO’s criteria and documenting everything properly.

    Pay Employee Super on Time

    Superannuation contributions can be a great tax deduction for employers—but only if the payments are made on time. That means received by the super fund or the SBSCH by 30 June 2025. Not just initiated—received. Many business owners get caught out here, assuming a bank transfer on the 30th is good enough. It’s not.

    Late payments don’t count for the current year’s tax deductions. That could mean missing out on thousands of dollars in tax savings. Plus, late super is not just non-deductible—it may also attract the Superannuation Guarantee Charge (SGC), which includes penalties and interest.

    What can you do to avoid this? Schedule payments well in advance, particularly if you’re making them through the SBSCH, which often takes a few days to process. If you find yourself in a last-minute scramble, contact your accountant immediately—there may still be a resolution available before the deadline.

    Bottom line: plan ahead. Superannuation is one of the most beneficial deductions available to employers, and missing out due to poor timing is a completely avoidable mistake.

    Defer Your Income Where Possible

    If you’re close to the EOFY and expecting a surge in revenue, consider deferring some of that income to the next financial year. It’s a simple and perfectly legal tactic that can help push your tax liability further down the track.

    How do you do it? Delay issuing invoices. Hold off on finalising jobs or requesting payment until after 30 June 2025. This is particularly useful for service-based businesses that operate on a cash or accrual basis—just be sure your accounting method supports this strategy.

    But it’s not without its pitfalls. If you’re too aggressive or inconsistent, it can raise red flags with the ATO. The key is balance and documentation. Make sure the deferral is genuine—don’t backdate or artificially manipulate your books.

    And remember: while deferring income can help in the short term, it might affect your cash flow. So weigh the tax benefits against your operational needs before making a decision.

    Bring Forward Expenses Before June 30

    Just like pushing income out can help, bringing expenses forward is another tried-and-true way to reduce your taxable income for the year. Think of it as getting credit now for costs you’ll incur anyway.

    What kind of expenses can you bring forward? Consumables are a good place to start: stationery, printer ink, marketing materials, packaging supplies, and office consumables. If you’re planning to order more soon, consider doing it now and paying upfront.

    You can also prepay certain services, like rent, subscriptions, and insurance, provided the service period doesn’t exceed 12 months. For “Small Business Entities,” the rules are even more flexible—thanks to special concessions that allow immediate deduction of prepayments.

    The magic lies in timing. Spend the money before 30 June 2025 and record it properly in your accounting system. Just ensure you’re not spending needlessly—only bring forward expenses you genuinely require. Otherwise, you’re just shifting cash out of your account without real benefit.

    Defer Investment Income and Capital Gains

    Selling an investment property? Earning interest on a term deposit? Timing could save you a significant chunk in taxes. If possible, delay the receipt of investment income and capital gains until after 30 June 2025.

    Let’s break it down. Investment income—like interest from a term deposit—is counted when it’s received or becomes payable. So, consider having the term deposit maturity date extended.

    When it comes to capital gains, the contract date—not the settlement date—is what matters for tax purposes. If you’re planning to sell an asset, try to sign the contract in July rather than June. This defers the capital gain into the next financial year, giving you more time to plan and possibly reduce the tax impact through other strategies.

    These deferral tactics need to be managed carefully. They’re perfectly legal, but if done too aggressively or frequently, they can draw ATO attention. That’s why it’s essential to plan with a trusted accountant who understands both the rules and your financial situation.

    Keep a Motor Vehicle Logbook

    If you’re using your vehicle for business purposes, you might be sitting on a valuable tax deduction—but only if you’ve got your documentation in order. That means a proper motor vehicle logbook, covering at least a continuous 12-week period, with a start date on or before 30 June 2025.

    What’s included in a logbook? For each journey, you need to record the date, start and end times, starting and ending odometer readings, the total kilometres travelled, and the reason for the trip. It’s not just busywork—it’s what the ATO uses to validate your claims.

    Once completed, your logbook is valid for five years, provided your business use doesn’t significantly change. That’s a long-term benefit for a short-term effort. Also, don’t forget to record your odometer reading as of 30 June 2025 and retain all your motor vehicle expense receipts.

    If a logbook feels too burdensome, there’s another method: the “cents per kilometre” method. You can claim up to 5,000 business kilometres per car without a logbook, using the ATO’s set rate per km (updated yearly). It’s simpler, but typically results in a lower claim than the logbook method.

    Either way, motor vehicle expenses are a major deduction category—and keeping accurate records ensures you don’t miss out or fall foul of ATO audits.

    Claim Investment Property Depreciation

    Do you own an investment property? If you’re not claiming depreciation on it, you’re almost certainly leaving money on the table. Depreciation allows you to offset the decline in value of your property’s structure and assets over time—resulting in a bigger deduction and less tax paid.

    Start with a Property Depreciation Report, also known as a Quantity Surveyor’s report. This professionally prepared document outlines all depreciable elements of your property, including construction costs, fixtures, fittings, and capital works. Without this report, you won’t know what you’re entitled to claim—and chances are it’s more than you think.

    There are two types of deductions available:

    1. Capital Works (Division 43) – for structural elements like walls, roofing, and fixed assets.
    2. Plant and Equipment (Division 40) – for removable items like carpets, blinds, and appliances (subject to recent restrictions based on when the property was acquired).

    These deductions can significantly improve your property’s cash flow by reducing your taxable income, especially in the early years of ownership. Just make sure you’re working with a licensed Quantity Surveyor and provide all necessary details about your property.

    Manage Private Company Loans (Div 7A)

    If you’ve borrowed money from your company—or are planning to—you need to be aware of Division 7A of the Income Tax Assessment Act. This is one of the most commonly misunderstood and mismanaged tax issues for business owners.

    Division 7A is designed to stop directors, shareholders and there associates from accessing company profits tax-free. If you take money out of the company without meeting the repayment conditions, the ATO may treat it as an unfranked dividend. That means it’s taxed in your personal name, with no franking credits to offset the tax hit.

    What can you do? You have two options:

    1. Repay the loan in full before 30 June 2025, or
    2. Put the loan under a complying Division 7A loan agreement, which includes minimum annual repayments of both principal and interest.

    If you’ve borrowed money in the current year, make sure the appropriate loan documentation is set up before the due date of the company’s tax return. This is crucial—missing this step could result in a costly and unexpected tax bill.

    Talk to your accountant well before year-end to review any outstanding loans and ensure you’re on track to comply with Division 7A.

    Do a Year-End Stocktake and WIP Review

    If you carry inventory or have projects in progress, a year-end stocktake and Work in Progress (WIP) assessment isn’t just good business—it’s also a tax necessity. As of 30 June 2025, you’ll need to provide a detailed list of what’s on hand or in progress.

    Why does this matter? Because the value of your stock and WIP affects your taxable income. An overstatement means paying more tax than necessary. An understatement? That could lead to compliance issues and penalties.

    Here’s what you need to do:

    • Conduct a physical count of all stock items
    • Identify and write off obsolete, damaged, or slow-moving inventory
    • Prepare a detailed listing with quantities, descriptions, and values
    • Consider the most beneficial stock valuation method (cost, market selling value, or replacement cost)

    For WIP, review each open job or project. Determine what portion of the work has been completed and what costs have been incurred. Then assess whether any revenue should be recognised in this financial year.

    Being proactive here can lead to better financial results and help you make smarter decisions going into the new year. Plus, it ensures your tax return is accurate and audit-ready.

    Write-Off Bad Debts Before EOFY

    Every business has a few clients who don’t pay up. Instead of letting those bad debts just sit there and weigh down your books, take action—before 30 June 2025.

    To claim a deduction for bad debts, they must be genuinely unrecoverable and written off in your accounts before year-end. That means updating your records, preparing a document (like a management meeting minute or email) noting that the debt has been reviewed and written off, and ensuring it’s entered into your accounting system.

    You also need to show you took reasonable steps to recover the debt, such as sending reminders or engaging a collection agency. It doesn’t need to go to court, but it should be clear that recovery is no longer viable.

    This deduction can significantly lower your taxable income, especially if you’ve previously included the income from the bad debt in your assessable revenue. Just make sure the write-off is real and well documented—this is another area where the ATO pays close attention.

    Use Small Business Concessions for Prepayments

    If your business qualifies as a Small Business Entity, there’s a neat trick you can use to reduce your 2025 tax bill: prepaying expenses. Under the small business concessions, you can claim a full deduction this financial year for certain prepaid expenses, even if they relate to services or goods you’ll receive in the next 12 months.

    So, what kind of expenses can you prepay? Think loan interest, rent, insurance, memberships, software subscriptions, and even business travel. The key rule is that the prepayment must not extend beyond 12 months—and the service period must end before the next financial year begins.

    This strategy is all about bringing forward your deductions. If you’ve had a strong year and anticipate a lower-income year ahead, prepaying expenses now can significantly reduce your current tax liability. Just make sure the expenses are business-related and you’ve got the proper invoices and payment confirmations on hand.

    It’s also worth noting that if your business does not qualify as a small business, the rules around prepayments become stricter, and you may need to apportion the deduction over multiple years. So again, confirm your eligibility and timing with your tax adviser.

    Prepare Trustee Resolutions Early

    If you operate through a discretionary or family trust, preparing and finalising your trustee resolutions before 30 June 2025 is absolutely critical. Why? Because these resolutions determine how your trust’s income is distributed—and the ATO insists that this decision is made before the EOFY to be valid.

    Failing to make a resolution on time could lead to all trust income being taxed at the highest marginal rate (currently 45%) in the trustee’s name. That’s a costly oversight no one wants to face.

    This year, trustee resolutions are even more crucial due to recent ATO rulings affecting how income can be distributed to adult children and other beneficiaries. These rulings could significantly impact your tax outcomes if not handled correctly.

    What should your resolution include? It should clearly state who will receive the trust’s income and how much. It must also be signed and dated on or before 30 June. Keep a copy for your records and ensure it aligns with your trust deed and financial accounts.

    In short, don’t leave this to the last minute. Work with your accountant to prepare compliant, tax-effective resolutions that reflect your intentions and protect your tax position.

    Consult with a Professional

    Let’s be real: tax laws are complicated, and they’re changing all the time. While this guide gives you a strong foundation, there’s no substitute for professional advice tailored to your specific circumstances.

    An experienced accountant or tax adviser doesn’t just help you tick boxes—they can show you strategies you might never have considered, review your structure for weaknesses, and make sure you’re staying compliant with the latest ATO expectations. In 2025, with tax office scrutiny on the rise, that support is more important than ever.

    What’s more, a professional can help you run “what-if” scenarios, adjust for personal or business changes, and ensure all your documentation is airtight. The money you spend on expert advice often pays for itself many times over in savings, peace of mind, and smarter business decisions.

    Don’t wait until June 30 to get help. The earlier you start planning, the more options you’ll have, and the more effective your strategies will be. Make the call today—it’s one of the best investments you can make in your business.

    Conclusion

    Tax time doesn’t have to be stressful or confusing. With a proactive approach, smart timing, and a little professional guidance, you can turn EOFY into an opportunity to strengthen your business, improve your finances, and set yourself up for a more prosperous future.

    From paying super contributions early, writing off bad debts, and keeping that all-important logbook, to using every deduction and concession available—there are dozens of legal and effective ways to reduce your tax liability for 2025.

    Don’t wait until the last minute. Take action now. Review your numbers, chat with your adviser, and make a checklist of the strategies most relevant to you. Every dollar you save on tax is a dollar that can be reinvested, spent, or saved to build a better future.

    FAQs

    1. What is the deadline for making tax-deductible super contributions in 2025?
    All contributions must be received by your fund or the Small Business Superannuation Clearing House (SBSCH) by 30 June 2025—not just initiated.

    2. Can I claim a tax deduction for prepaying rent or insurance?
    Yes, if you’re a Small Business Entity, you can prepay eligible expenses (up to 12 months) and claim the full deduction in the 2025 financial year.

    3. What should I include in a motor vehicle logbook?
    Details like trip dates, start/end odometer readings, kilometres travelled, and the business purpose of each trip over a 12-week period.

    4. Are trustee resolutions mandatory for family trusts every year?
    Absolutely. Resolutions must be signed and dated on or before 30 June annually to avoid the trust income being taxed at the top marginal rate.

    5. Is it too late to start tax planning in June?
    Not necessarily—but the earlier you act, the more options you’ll have. Some strategies require time to implement correctly, so don’t delay.

    Looking for tax and business advice CALL or EMAIL LTs team of Chartered Accountants, Tax Advisors and Business Advisors Today.

    Disclaimer
    The information contained in this publication is for general information purposes only, professional advice should be obtained before acting on any information contained herein. Neither the publishers nor the distributors can accept any responsibility for loss occasioned to any person as a result of action taken or refrained from in consequence of the contents of this publication.

  • Should I Keep Paying For My Insurance Through My Super Fund?

    Should I Keep Paying For My Insurance Through My Super Fund?

    The end of the financial year is the perfect time to review your insurance arrangements, including your general business insurance and personal life insurance policies.

    Many believe it’s best to hold life insurance through superannuation, largely because the premiums can be tax-deductible. While this can be a smart strategy sometimes, it’s not always the best fit for everyone.

    When you pay for life insurance through your super, you’re drawing down your super balance.

    While there are limits on how much you can contribute to super, there’s no limit on how much can be deducted to cover insurance premiums.

    In some extreme cases, people may unknowingly reduce their retirement savings by funding large insurance premiums through super, while building investment assets outside of super and paying more tax on the income those assets generate, which can significantly hinder long-term wealth creation.

    That said, if you’re not contributing the maximum to your super each year, then funding life insurance through super can be tax-effective.

    For lower-income earners, holding assets in your own name may also have no tax disadvantage. It’s also worth considering whether your insurance through super is more affordable or simply the most practical way to ensure you’re covered, especially if your cash flow outside of super is limited.

    Another important consideration is who your beneficiaries are. If you’re planning to leave your life insurance to adult children or if you need to claim a TPD (Total and Permanent Disability) benefit, depending on how your policy is structured, there may be tax implications.

    That’s why it’s essential to review your insurance with both an accountant to help you navigate the tax side and an insurance adviser to ensure you’ve got the right coverage at the best price.

    A little planning now can make a big difference to your future. Why not ask us how we can assist you at the end of the financial year with your tax, super or business needs?

    Disclaimer
    The information contained in this publication is for general information purposes only, professional advice should be obtained before acting on any information contained herein. Neither the publishers nor the distributors can accept any responsibility for loss occasioned to any person as a result of action taken or refrained from in consequence of the contents of this publication.

  • Who Gets The Trust Distributions This Year?

    Who Gets The Trust Distributions This Year?

    Under tax law, beneficiaries of a trust must be entitled to their share of the trust’s income as at 30 June.

    It’s a bit of a strange rule –  it means you have to decide who gets the income before you even know how much income there will be.

    That’s why it’s so important to touch base with your accountant before the end of the financial year. Your accountant can help estimate how much income and capital gains your trust is likely to generate, so you can make informed decisions about how best to distribute it.

    Keep in mind: once you resolve to distribute trust income to someone, that person becomes liable for the tax on it, even if they don’t physically receive the money.

    On the surface, it may seem like a great idea to name low-income family members as beneficiaries to take advantage of their lower tax brackets.

    However, recent ATO rulings have clarified that they’re watching that practice closely. If someone is named as a beneficiary, they must receive the real economic benefit of that income.

    For example, if you distribute $100,000 to your 18-year-old son, you need to be able to show that he genuinely benefited from that money. Understandably, you may not want to hand over a $100,000 cheque, but you still want to utilise his lower tax rate.

    That’s where your accountant can help. They will work with you to find a compliant and sensible balance and determine what level of distribution is appropriate without attracting unwanted ATO attention.

    Another key consideration is that once someone receives a distribution, they may become a connected entity of the trust, with this status lasting for four years.

    That may not matter immediately, but it could have tax implications, especially if you plan to sell a business in the next few years. Connected entities are included when applying small business tax concessions, so getting this wrong could cost you down the track.

    In short, a little planning can make a big difference later.

    Let’s chat before 30 June so we can help you get your trust distributions right, and avoid any tax-time headaches from coming your way.

    Disclaimer
    The information contained in this publication is for general information purposes only, professional advice should be obtained before acting on any information contained herein. Neither the publishers nor the distributors can accept any responsibility for loss occasioned to any person as a result of action taken or refrained from in consequence of the contents of this publication.

  • Sustainable Business Practices – A Key Focus For Owners

    Sustainable Business Practices – A Key Focus For Owners

    Sustainability has become a key focus for businesses across all industries. 

    Companies are increasingly recognising that sustainable business practices not only help the environment but also improve efficiency, reduce costs, and enhance their reputation with customers. 

    Whether you’re a small business owner or running a larger enterprise, adopting sustainability can have lasting benefits.

    What Are Sustainable Business Practices?

    Sustainable business practices are strategies that minimise environmental impact, promote social responsibility, and support long-term economic viability. 

    These practices focus on reducing waste, conserving resources, and making ethical business decisions that benefit the company and the community.

    Sustainability isn’t just about “going green” but includes ethical sourcing, fair labor practices, and community engagement. 

    A business that adopts sustainability considers the long-term impact of its decisions rather than just short-term profits.

    Examples of Sustainable Practices in an Average Business

    Implementing sustainability in a business doesn’t have to be complex. Here are some practical ways businesses of all sizes can incorporate sustainable practices:

    1. Reducing Energy Consumption

    One of the easiest ways for businesses to become more sustainable is by cutting down on energy use. This can include:

    • Switching to LED lighting, which lasts longer and consumes less power.
    • Motion-sensor lights should be installed in restrooms and storage rooms to prevent unnecessary energy use.
    • Using energy-efficient appliances and equipment, such as Energy Star-rated office machines.
    • Encouraging remote work or hybrid work models to reduce energy use in office spaces.

    2. Minimising Waste and Encouraging Recycling

    Waste reduction is another essential aspect of sustainability. Businesses can:

    • Set up recycling stations for paper, plastics, and e-waste.
    • Go paperless by using digital invoicing, contracts, and communications.
    • Provide reusable office supplies such as whiteboards instead of sticky notes.
    • Partner with suppliers that use minimal or biodegradable packaging.

    3. Sustainable Sourcing and Supply Chains

    A sustainable business ensures that its suppliers follow ethical and environmentally friendly practices. This might include:

    • Choosing suppliers that use recycled or sustainable materials.
    • Sourcing fair-trade coffee, tea, or other ethically produced goods.
    • Working with local vendors to reduce carbon emissions from transportation.
    • Avoiding single-use plastics by opting for bulk purchasing where possible.

    4. Water Conservation Efforts

    Water is a valuable resource, and businesses can take steps to use it more efficiently:

    • Installing water-efficient fixtures such as low-flow faucets and toilets.
    • Using rainwater collection systems for irrigation or cleaning purposes.
    • Educating employees on simple conservation habits like turning off taps properly.

    5. Implementing Ethical Labor Practices

    Sustainability isn’t just about the environment—it’s also about taking care of people. Businesses can:

    • Provide fair wages and safe working conditions for employees.
    • Support diversity and inclusion in hiring practices.
    • Offer flexible work arrangements that promote a better work-life balance.

    6. Supporting the Local Community

    A sustainable business also gives back to the community by:

    • Donating to local charities or causes.
    • Hosting community clean-up events.
    • Partnering with other small businesses to support the local economy.

    7. Carbon Footprint Reduction Initiatives

    Many businesses are working to lower their carbon footprint by:

    • Offsetting emissions by planting trees or investing in renewable energy projects.
    • Encouraging employees to carpool, bike, or use public transportation.
    • Switching to electric or hybrid company vehicles.

    The Benefits of Sustainable Business Practices

    Adopting sustainable practices can provide multiple advantages, including:

    •  Cost Savings – Reducing waste and energy consumption leads to lower operational expenses.
    • Improved Brand Reputation – Consumers are increasingly choosing eco-conscious businesses.
    • Regulatory Compliance – Sustainability initiatives can help businesses meet environmental regulations and avoid penalties.
    • Long-Term Growth – Sustainable businesses tend to be more resilient in changing economic conditions.

    Sustainability isn’t just for large corporations – it’s something businesses of all sizes can implement in simple yet impactful ways. 

    By reducing waste, using resources more efficiently, and making ethical business decisions, companies can contribute to a healthier planet while also benefiting their bottom line. 

    Whether you run a small café, an office-based business, or a large retail store, adopting sustainable practices can make a meaningful difference. Want to find out more about how your business could be improved, whether it’s in practice, operations or administration? Speak with one of our trusted business advisers

  • The Role of a Corporate Trustee in SMSFs: Why It Matters

    The Role of a Corporate Trustee in SMSFs: Why It Matters

    When setting up a Self-Managed Super Fund (SMSF), choosing the right trustee structure is critical. You can opt for individual trustees or a corporate trustee, but the latter often offers unique benefits that make managing your fund easier and more effective.

    What Is a Corporate Trustee?

    A corporate trustee is a company appointed to act as the legal trustee of your SMSF. In this setup, SMSF members become directors of the company, creating a clear separation between the fund’s assets and personal assets.

    Why Choose a Corporate Trustee?

    1. Simplified Administration: Changes to fund membership are easier to manage with a corporate trustee. Adding or removing members does not require updates to asset titles, saving time and costs.
    2. Enhanced Asset Protection: A corporate trustee ensures a clear distinction between SMSF assets and personal assets, reducing the risk of disputes or confusion.
    3. Improved Compliance and Continuity: A company’s perpetual existence ensures the fund’s continuity if a member passes away or becomes incapacitated. Corporate trustees also simplify compliance with SMSF regulations.
    4. Efficient Decision-Making: Directors of the corporate trustee can act quickly and cohesively to make decisions that align with the SMSF’s goals.

    Considerations

    While corporate trustees offer significant advantages, they come with additional costs, including ASIC registration and annual fees. However, these expenses are often outweighed by the long-term benefits, especially for larger or growing funds.

    Opting for a corporate trustee can provide your SMSF with flexibility, protection, and efficiency.

    This structure is particularly beneficial as your fund grows or your circumstances change.

    If you’re setting up an SMSF or considering switching from individual trustees, it’s wise to consult with a financial advisor or SMSF specialist to ensure you make the best choice for your retirement goals. We may be able to assist you by putting you together with someone who can help.

    By understanding the role and benefits of a corporate trustee, you’re taking an important step toward ensuring the success and compliance of your SMSF. It’s about making your fund work smarter, not harder, for your financial future.

    The Pension Phase of Your SMSF: Simplifying the Transition

    As you approach retirement, your Self-Managed Super Fund (SMSF) can transition from the accumulation phase into the pension phase. This shift is a significant milestone and can offer tax benefits and a steady income stream for your retirement years.

    Let’s explore what this transition entails and how it supports your fiscal goals.

    Understanding the Transition to Pension Mode

    When you retire, your SMSF can start paying you a pension, turning your accumulated super savings into a reliable income stream. To make this transition, your SMSF must meet specific conditions of release, such as reaching the preservation age and officially retiring from the workforce.

    Once these conditions are met, your fund can move into pension mode. In this phase, your SMSF’s income is used to pay you a regular pension while enjoying significant tax advantages. For instance, earnings on assets supporting your pension become tax-free, allowing your fund to work more efficiently.

    Minimum Pension Requirements

    The Australian Tax Office (ATO) sets minimum pension withdrawal rates based on your age. Ensuring your SMSF meets these requirements annually is essential to maintain its tax-free status in pension mode. Failing to withdraw the minimum amount could result in your fund losing its tax concessions.

    Strategic Considerations for Your SMSF

    1. Asset Allocation: Ensure your SMSF’s investments align with your income needs. As you retire, a more conservative investment strategy may help protect your capital while providing consistent returns.
    2. Documentation: Update your SMSF’s trust deed and ensure all documentation complies with pension phase requirements. Proper records are vital to meet ATO regulations.
    3. Estate Planning: Review your SMSF’s binding death benefit nominations to ensure your retirement savings are distributed according to your wishes.

    Professional Guidance is Key

    Transitioning your SMSF to pension mode involves important decisions and compliance requirements. A licensed SMSF accountant or advisor can guide you through this process, ensuring your fund operates smoothly and takes full advantage of tax benefits. By planning carefully, you can enjoy a financially secure and stress-free retirement.

    If you’re considering the next steps for your SMSF, feel free to reach out for tailored advice. Together, we can ensure your retirement years are as rewarding as you’ve envisioned.

    Looking for more information on SMSFs? Visit our dedicated SMSF website: https://self-managedsuperfund.com.au/

    Disclaimer
    The information contained in this publication is for general information purposes only, professional advice should be obtained before acting on any information contained herein. Neither the publishers nor the distributors can accept any responsibility for loss occasioned to any person as a result of action taken or refrained from in consequence of the contents of this publication.

  • Proactive Tax Planning Starts With You

    Proactive Tax Planning Starts With You

    As the end of the financial year (EOFY) approaches, it’s time to get your business records in order and ensure everything is ready for tax time.

    EOFY can feel overwhelming, but with a bit of preparation and guidance, you can wrap things up smoothly and even find opportunities to strengthen your financial position for the year ahead.

    Here’s a step-by-step guide to help you prepare:

    1 – Reconcile Your Accounts
    Start by reviewing your accounting software and ensuring all bank transactions, invoices, and payments are up to date. Double-check that your bank statements reconcile with your accounting records. If anything looks out of place, now’s the time to investigate and fix it.

    2 – Organise Your Paperwork
    Whether you keep records digitally or in hard copy, make sure all receipts, invoices, and financial documents are properly filed and accessible. This includes:
    • Expense receipts
    • Sales records
    • Loan documents
    • Asset purchase records
    • Contractor invoices
    Your accountant will need these to finalise your accounts and claim eligible deductions.

    3 – Review Your Debtors and Creditors
    Take stock of your outstanding invoices. If clients owe you money, follow up and try to collect payment before EOFY. At the same time, review any bills or invoices you haven’t yet paid – these may be deductible this financial year if paid before 30 June.

    4 – Check for Tax-Deductible Opportunities
    There may still be time to bring forward expenses or make additional purchases before 30 June. Some examples include:
    • Prepaying rent, insurance or subscriptions
    • Purchasing tools, equipment, or office supplies
    • Making superannuation contributions for yourself or employees
    Your accountant can guide you on what’s eligible and beneficial based on your cash flow.

    5 – Stocktake and Asset Review
    If you sell physical products, a stocktake is essential. Note any slow-moving, obsolete, or damaged stock. Similarly, review your asset register – are there any outdated or scrapped items that can be written off?

    6 – Superannuation and Payroll Reporting

    Ensure all superannuation guarantee contributions are paid on time to claim deductions. Also, make sure your Single Touch Payroll (STP) reporting is up to date. You’ll need to finalise your payroll for the year and provide income statements to your employees through the ATO system.

    6 – Meet with Your Accountant
    EOFY is a perfect time for a financial health check. Book a meeting with your accountant to:
    • Review your tax position.
    • Discuss any changes in business structure.
    • Plan for the next financial year.
    • Explore strategies to minimise tax and improve cash flow.

    We can also help you avoid common EOFY pitfalls and ensure your reporting is accurate and compliant.

    EOFY doesn’t have to be stressful. With some planning and support from your accountant, you can close out the year with confidence and clarity. Even better, EOFY prep often reveals insights to help your business grow stronger in the new financial year.

    If you need help getting ready, contact our tax accountants – we’re here to guide you every step of the way.

    Disclaimer
    The information contained in this publication is for general information purposes only, professional advice should be obtained before acting on any information contained herein. Neither the publishers nor the distributors can accept any responsibility for loss occasioned to any person as a result of action taken or refrained from in consequence of the contents of this publication.

  • Boosting A Spouse’s Super Before The EOFY

    Boosting A Spouse’s Super Before The EOFY

    You might want to top up your spouse’s superannuation for plenty of reasons.

    Maybe you’ve accumulated more super than they have and want to even things out for retirement. Or perhaps your spouse is older and you’re keen to access those funds sooner. Maybe they had to take a career break, and you want to keep their balance up. 

    Whatever the motivation, it’s helpful to know that the super system allows for this kind of strategic planning – but there’s a deadline to keep in mind.

    Under current superannuation rules, you have until 30 June to instruct your fund to roll over up to 85% of your previous year’s concessional contributions into your spouse’s super account.

    Concessional contributions include any super contributions your employer makes and any personal contributions you’ve made and claimed a tax deduction for. When transferring these to your spouse, you can only move up to 85% of the amount, because a 15% contributions tax has already been deducted.

    Even if you’ve used the carry-forward concessional contributions rule to make a larger deductible contribution in a particular year, you can still split 85% of the total amount you claimed a deduction for. It’s a handy strategy, especially if one partner is behind on their super savings.

    But, notably, this isn’t a once-off opportunity. You can keep doing it each year until your spouse turns 65.

    Important Things to Keep in Mind

    Not all super funds support contribution splitting unless your spouse is also a member of the same fund. So it’s essential to check with your provider to see if they allow spouse contribution splitting, and to request the relevant forms or procedures.

    If you have a self-managed super fund (SMSF), it’s much easier – we can handle the whole process for you.

    Want to know more about superannuation before the end of financial year? Why not speak with your LT licensed adviser about the subject?

    Disclaimer
    The information contained in this publication is for general information purposes only, professional advice should be obtained before acting on any information contained herein. Neither the publishers nor the distributors can accept any responsibility for loss occasioned to any person as a result of action taken or refrained from in consequence of the contents of this publication.

  • The Instant Asset Write-Off: A Small Business Tax Perk Worth Knowing About

    The Instant Asset Write-Off: A Small Business Tax Perk Worth Knowing About

    If you’re running a small business in Australia, you’ve probably heard the term “instant asset write-off” tossed around—especially come tax time, and more recently in the news. But what is it? And how can it benefit your business?

    What is the Instant Asset Write-Off?
    The instant asset write-off (IAWO) is a handy tax rule that lets eligible small businesses immediately deduct the cost of assets they’ve purchased for the business, rather than depreciating them over several years.

    This means if you buy a new laptop, tools, or even a piece of machinery, you might be able to claim the whole cost in your tax return for that year, as long as it meets certain criteria.

    It’s all about giving small businesses a cash flow boost and encouraging investment.

    Who’s Eligible?
    To use the instant asset write-off, your business needs to:
    • Have an aggregated turnover of less than $10 million, and
    • Use the simplified depreciation rules for small businesses.
    You also need to use the asset (or have it ready to use) in the year you’re claiming the deduction.

    What’s the Current Threshold?
    From 1 July 2023 to 30 June 2025, the write-off threshold is $20,000 per asset. It was also recently announced that the IAWO will be extended for a further 12 months.

    So, you can write off multiple assets in the same year—as long as each one costs less than $20,000 (before GST if you’re registered for GST). That includes both new and second-hand assets.

    For Example
    Let’s say you run a small plumbing business and buy a second-hand ute for $18,000 in August 2024. As long as your business meets the criteria and you start using the vehicle that year, you can write off the full $18,000 on your 2024–25 tax return.

    That’s a solid deduction that could make a real difference in managing your end-of-year finances. However, if you’re unsure if a purchase would be eligible for the deduction, speak with your trusted tax adviser first!

    A Few Things to Watch Out For
    • If the asset costs more than $20,000, you can’t write it off instantly, you’ll need to depreciate it over time.
    • You can only claim the business-use portion of the asset. So if you buy a laptop for $2,000 and use it 80% for work, you can only claim $1,600.
    • Not all assets qualify. Some items, like capital works or certain in-house software, are excluded.

    Why It Matters
    Tax rules can be confusing, but the instant asset write-off is one of the more straightforward ways small business owners can reduce their tax bill. It encourages investment, rewards business growth, and helps smooth out cash flow—especially helpful when times are tight.

    In a Nutshell?
    If you’ve had your eye on new tools, tech, or equipment to help your business run more smoothly, the instant asset write-off might make it a little easier to say yes.

    Just make sure you’re keeping good records, checking the current ATO guidelines, and (as always) talking things over with your accountant or tax adviser to make sure you’re making the most of it.

    Want further guidance on this matter? Speak with one of our trusted tax accountants – we’re here to help.

    Disclaimer
    The information contained in this publication is for general information purposes only, professional advice should be obtained before acting on any information contained herein. Neither the publishers nor the distributors can accept any responsibility for loss occasioned to any person as a result of action taken or refrained from in consequence of the contents of this publication.

  • Understanding the Bond Market in Times of Turbulence

    Understanding the Bond Market in Times of Turbulence

    I recently read the following opinion piece in the Financial Review by Jonathan Shapiro a senior reporter:

    “This week it’s been a tale of two markets. Global equity markets have been in a state of chaos, swinging from panic to relief and back to panic as US President Donald Trump wavered on tariffs but held the line on China.

    Meanwhile, the bond market has been defying Trump, with long-term yields nudging higher to worrying levels, forcing him to call a 90-day truce with trade partners. The usual flight to safety toward long-term US government bonds occurred at first but has since very much reversed.  The reversal shows no signs of slowing. (read more)

    To better understand the bond market and how it helps interpret how investors perceive economic health, risk, and policy effectiveness—especially in turbulent times like those involving trade conflicts the following may help:

    What is the Bond Market?

    The bond market is where investors buy and sell debt securities (bonds) primarily issued by governments, municipalities, and corporations to raise capital. Investors who purchase bonds are essentially lending money to the issuer in exchange for regular interest payments and repayment of the principal at maturity.

    Key Concepts to Understand

    1. Bond Prices and Interest Rates (Yields):

    • Bond prices and yields move inversely.
      • When bond prices rise, yields fall.
      • When bond prices fall, yields rise.

    Why this happens:
    If investors believe risk in the economy is increasing, they typically buy bonds because bonds are safer compared to stocks. This increased demand pushes bond prices up and yields down.

    Conversely, if investors feel confident and optimistic, they might sell bonds to invest in riskier assets like stocks, which pushes bond prices down and yields up.

    2. Bond Yields as Indicators:

    • Bond yields reflect investor expectations about the economy, inflation, and monetary policy.
    • Higher long-term yields often signal:
      • Expectations of higher economic growth.
      • Concerns about rising inflation.
      • Anticipation of interest rate increases from central banks.
    • Lower yields typically indicate:
      • Economic uncertainty or potential recession fears.
      • Deflationary pressures.
      • Expectations of rate cuts or accommodative monetary policy.

    Bond Market Behaviour Explained in the above Scenario:

    Initial Panic (Flight to Safety):

    • Initially, amid trade tensions and market chaos, investors panicked, seeking safer assets.
    • They bought long-term US government bonds (Treasuries) because these are considered some of the safest assets globally.
    • Increased demand pushed up bond prices and consequently, pushed yields down.

    Why the Bond Market Reversed (Yields Rose Again):

    • When bond yields began nudging higher despite ongoing volatility, this indicated a shift in market perception.
    • Investors became concerned about inflationary pressures potentially arising from the tariffs imposed by President Trump.
    • Trade tariffs can increase costs, raising inflation expectations. Higher inflation erodes bond value over time, thus investors demand higher yields (lower prices) to compensate.
    • The rising yields indicated bond investors weren’t just seeking safety but were worried about long-term risks—like inflation—stemming from Trump’s trade actions.

    Trump’s Response (90-Day Truce):

    • Trump noticed these rising bond yields as a signal that markets were becoming increasingly uneasy.
    • Higher yields also increase borrowing costs for governments, businesses, and consumers, potentially slowing economic growth.
    • To calm the markets, Trump implemented a 90-day trade truce, temporarily reducing the immediate threat of tariffs and economic disruption.
    • This action aimed to restore market confidence and stabilise bond yields.

    Summary of the Cycle:

    1. Panic sets in: Stocks fall → Investors buy safe bonds → Bond prices rise, yields fall.
    2. Inflation concerns arise: Tariffs threaten higher costs → Investors sell bonds due to inflation worries → Bond prices fall, yields rise.
    3. Policy reaction: Trump calls a trade truce → Immediate pressures ease, yields stabilise temporarily.

    Why Bond Market Matters:

    • Bond markets directly impact interest rates throughout the economy (mortgages, loans, credit cards).
    • Changes in bond yields significantly influence investment decisions across all financial markets.
    • Investors closely watch the bond market as an indicator of future economic conditions and policy decisions.

    Understanding the bond market helps interpret how investors perceive economic health, risk, and policy effectiveness—especially in turbulent times like those involving trade conflicts.

    Still A Safe Haven?

    Traditionally, U.S. government bonds have been viewed as the ultimate safe-haven asset — a reliable refuge during times of economic or market uncertainty. However, the recent volatility and perceived policy irrationality have started to challenge this perception. With the escalating trade tensions and unpredictability around tariff decisions, investors have grown cautious about holding U.S. bonds, leading to increased selling pressure and rising interest rates (yields). Consequently, as confidence in bonds diminishes, investors have increasingly turned towards gold as their preferred safe haven, viewing it as a more stable store of value amid the current uncertainty and erratic market conditions.

  • Legislative Impact For Business: General Interest Charge (GIC) and Shortfall Interest Charge (SIC) to Become Non-Deductible from 1 July 2025

    Legislative Impact For Business: General Interest Charge (GIC) and Shortfall Interest Charge (SIC) to Become Non-Deductible from 1 July 2025

    SIGNIFICANT IMPACT FOR BUSINESS –  Legislation Passed: General Interest Charge (GIC) and Shortfall Interest Charge (SIC) to Become Non-Deductible from 1 July 2025

    On Wednesday, 26 March 2025, Parliament passed amendments that will deny deductions for general interest charge (GIC) and shortfall interest charge (SIC) incurred on or after 1 July 2025. This change is highly significant and could be very costly for businesses, particularly those with outstanding tax debts or regular participants in ATO payment plans.

    The True Cost of GIC and SIC After 1 July 2025

    Currently, GIC is charged at 11.17% and SIC at 7.17%. While businesses and individuals can currently claim a deduction for these charges, the removal of this deduction will dramatically increase the after-tax cost of carrying tax debt.

    Depending on your marginal tax rate, the effective cost of GIC after 1 July 2025 will range from 9.56% for those on the lowest marginal rate to as high as 21% for those on the top marginal tax rate. For businesses or individuals already managing tight cash flow, this additional burden could severely impact their financial position.

    Why This Change is Significant

    Labor has stated that these amendments are designed to promote compliance and level the playing field between taxpayers who meet their obligations and those who do not. However, the impact on small businesses and sole traders is expected to be severe, with many advocacy groups and accounting bodies warning of potentially detrimental consequences.

    The Tax Institute raised concerns that increased financial pressure from non-deductible GIC and SIC may force businesses to divert resources from critical operations, such as payroll or inventory management, putting their long-term viability at risk.

    CPA Australia labelled the measure as excessive, particularly given the ATO’s already firm approach to debt recovery. CPA Australia’s tax lead, Jenny Wong, highlighted that businesses with cash flow challenges, particularly sole traders on high marginal tax rates, will be disproportionately affected. Wong questioned whether the change was about repaying tax debt or imposing penalties on taxpayers striving to meet their obligations.

    Our Key Concerns and Recommendations for Clients

    Given the seriousness of these changes, we are advising our clients to take proactive steps to mitigate potential risks. Our primary concerns and recommendations are:

    1. Timely Notification of Tax Payment Due Dates

    It is essential that you are aware of your tax payment due dates to avoid the imposition of GIC and SIC.

    2. Strict Adherence to Lodgement Deadlines

    Lodgement deadlines will become even more critical. Ensuring compliance with lodgement dates will minimise the likelihood of triggering GIC and SIC charges. We strongly recommend that clients provide all necessary information in advance to prevent delays in lodgement.

    3. Awareness for Clients in ATO Payment Plans

    For clients who are currently engaged in ATO payment plans, it is imperative that you are aware of these changes. Many businesses have relied on the ability to deduct GIC and SIC to offset some of the cost associated with payment plans. After 1 July 2025, the full cost of these interest charges will need to be borne by the business. Without adequate planning, this could come as a significant and unwelcome surprise.

    Potential Refinancing Options and Tax Planning Considerations

    Chartered Accountants Australia and New Zealand (CA ANZ) has previously cautioned that the denial of GIC and SIC deductions may drive businesses to seek alternative financing options, such as loans from traditional financial institutions where interest remains tax-deductible. However, not all businesses may be able to secure alternative financing, leaving some businesses exposed to significantly higher costs.

    What This Means for Your Business

    With these changes now enshrined in law, it is critical for businesses to:

    • Monitor tax liabilities carefully and ensure timely payments.
    • Avoid unnecessary delays in lodgement to mitigate exposure to GIC and SIC.
    • Evaluate financing options to reduce exposure to high, non-deductible interest charges.
    • Review ATO payment plans and consider alternatives where possible.

    If you have any questions or would like to discuss how these changes may impact your business, please contact the team at Leenane Templeton. Being proactive now will help prevent significant financial strain in the future.

  • Claiming Expenses Incurred As A Result Of Natural Disasters: Rental Property Owners Beware!

    Claiming Expenses Incurred As A Result Of Natural Disasters: Rental Property Owners Beware!

    Natural disasters can cause significant damage to rental properties and business premises, leading to costly repairs and financial uncertainty.

    If you own a rental property or business premises that has been impacted, it’s important to understand what expenses you can claim and any income you need to declare during the recovery process.

    Claiming Expenses for Repairs and Rebuilding
    When restoring your property, you may be able to claim certain expenses as tax deductions. However, there are distinctions between what is considered a repair, maintenance, or a capital improvement, each affecting how expenses are claimed.

    Repairs and Maintenance (Immediately Deductible)
    Repairs involve fixing damage caused by the disaster without significantly improving the property. Examples include:
    • Replacing broken windows, doors, or damaged roof tiles
    • Repairing flood or fire-damaged walls and floors
    • Fixing electrical wiring and plumbing issues
    These expenses are immediately deductible, meaning they can be claimed in the same financial year they were incurred.

    Capital Improvements (Depreciated Over Time)
    If you go beyond restoring the property to its original condition by making significant upgrades, the expenses may be classified as capital improvements. Examples include:
    • Rebuilding an entire section of the property with modern materials
    • Upgrading fixtures and fittings beyond their previous state
    • Adding extensions or additional rooms
    These costs must be depreciated over time rather than claimed immediately.

    Insurance Payouts and Government Assistance
    If you receive an insurance payout, a government disaster recovery grant, or another form of assistance to cover repairs, these amounts may be assessable income and must be reported in your tax return. However, some grants may be tax-exempt, so it’s important to check with the ATO or your accountant.
    Declaring Income from Your Rental Property or Business Premises
    While your property is being repaired, you may experience interruptions to your usual rental or business income. However, certain payments still need to be declared as income:
    • Insurance Payouts for Lost Rental or Business Income – If your insurance covers lost rental or business revenue, this amount is considered taxable income.
    • Temporary Rent from Short-Term Leasing – If you receive temporary rental income (e.g., renting a portion of your business premises while rebuilding), this must be declared.

    If your property is uninhabitable and not generating rental income, you do not need to report rental income during this period.

    Other Tax Considerations
    • Loan Interest – If you take out a loan to repair the property, interest payments may be tax-deductible.
    • Scrapping Deductions – If part of your building is demolished and replaced, you may be able to claim a deduction for the remaining value of the demolished assets.
    • Capital Gains Tax (CGT) Implications – If the disaster forces you to sell the property, CGT exemptions or concessions may apply.
    Navigating the tax implications of repairing and rebuilding after a disaster can be complex, but understanding what expenses you can claim and what income must be declared will help you manage your financial recovery.

    If you’re unsure about your specific situation, seeking professional tax advice can ensure you’re making the most of available deductions while complying with tax requirements.

    Disclaimer
    The information contained in this publication is for general information purposes only, professional advice should be obtained before acting on any information contained herein. Neither the publishers nor the distributors can accept any responsibility for loss occasioned to any person as a result of action taken or refrained from in consequence of the contents of this publication.

  • Federal Budget 2025-2026

    Federal Budget 2025-2026

    A summary of the highlights from the Federal Government’s 2025/26 Budget.

    Personal Income Tax – increasing the Medicare levy low‑income thresholds

    The Government will increase the Medicare levy low‑income thresholds for singles, families, and seniors and pensioners from 1 July 2024 to provide cost‑of‑living relief. The increase to the thresholds ensures that low‑income individuals continue to be exempt from paying the Medicare levy or pay a reduced levy rate.

    The increase to the thresholds is estimated to decrease receipts by $648.0 million over five years from 2024–25.

    The threshold for singles will be increased from $26,000 to $27,222. The family threshold will be increased from $43,846 to $45,907. For single seniors and pensioners, the threshold will be increased from $41,089 to $43,020. The family threshold for seniors and pensioners will be increased from $57,198 to $59,886. The family income thresholds will increase by $4,216 for each dependent child or student, up from $4,027.

    Source: Budget Paper No 2, p 5.

    Personal Income Tax – new tax cuts for every Australian taxpayer

    The Government will deliver new tax cuts to every Australian taxpayer from 1 July 2026.

    These tax cuts are in addition to the first round of tax cuts for every taxpayer that the Government legislated last year, which have been rolling out since 1 July 2024.

    The new tax cuts will provide more cost-of-living relief and return bracket creep. They will also boost labour supply, particularly for women.

    Under the Government’s new tax cuts:

    • From 1 July 2026, the 16 per cent rate will be reduced to 15 per cent.
    • From 1 July 2027, the 15 per cent rate will be reduced further to 14 per cent.

    This measure is estimated to decrease receipts by $17.1 billion over five years from 2024–25.

    Source: Budget Paper No 2, p 5.

    Restricting Foreign Ownership of Housing

    The Government will take action to ensure foreign investment in housing supports the Government’s broader agenda to boost Australia’s housing supply by:

    • Banning foreign persons (including temporary residents and foreign‑owned companies) from purchasing established dwellings for two years from 1 April 2025, unless an exception applies. Exceptions to the ban will include investments that significantly increase housing supply or support the availability of housing on a commercial scale, and purchases by foreign‑owned companies to provide housing for workers in certain circumstances.
    • Providing the Australian Taxation Office (ATO) $5.7 million over four years from 2025–26 to enforce the ban.
    • Providing the ATO and Treasury $8.9 million over four years from 2025–26 and $1.9 million per year ongoing from 2029–30 to implement an audit program and enhance their compliance approach to target land banking by foreign investors.

    The ban will mean Australians will be able to buy homes that would have otherwise been bought by foreign persons, while encouraging foreign persons to boost Australia’s housing supply.

    The enhanced compliance approach by the ATO and Treasury to target land banking will ensure foreign investors comply with requirements to put vacant land to use for residential and commercial developments within reasonable timeframes.

    This measure is estimated to decrease receipts by $90.0 million and increase payments by $14.6 million over five years from 2024–25.

    Source: Budget Paper No 2, p 6.

    Strengthening Tax Integrity

    The Government will strengthen the fairness and sustainability of Australia’s tax system by providing $999.0 million over four years to the Australian Taxation Office (ATO) to extend and expand tax compliance activities.

    Additional funding includes:

    • $717.8 million over four years from 1 July 2025 for a two-year expansion and a one-year extension of the Tax Avoidance Taskforce. This supports the ATO’s continued tax compliance scrutiny on multinationals and other large taxpayers.
    • $155.5 million over four years from 1 July 2025 to extend and expand the Shadow Economy Compliance Program to reduce shadow economy behaviour such as worker exploitation, under‑reporting of taxable income, illicit tobacco and other shadow economy activity that enables non‑compliant businesses to undercut competition.
    • $75.7 million over four years from 1 July 2025 to extend and expand the Personal Income Tax Compliance Program. This will enable the ATO to continue to deliver a combination of proactive, preventative and corrective activities in key areas of non-compliance.
    • $50.0 million over three years from 1 July 2026 to extend the Tax Integrity Program. This will enable the ATO to continue its engagement program to ensure timely payment of tax and superannuation liabilities by medium and large businesses and wealthy groups.

    This measure is estimated to increase receipts by $3.2 billion over five years from 2024–25, and increase payments by $1.4 billion, including an increase in GST payments to the states and territories of $402.6 million and $31.0 million in unpaid superannuation to be disbursed to employees.

    Source: Budget Paper No 2, p 7.

    Building Australia’s Future – Improving Outcomes in Australian Schools

    The Government will provide $407.5 million over four years from 2025–26 (and $7.2 billion from 2029–30 to 2035–36) to jurisdictions which have signed Better and Fairer Schools Agreement (Full and Fair Funding 2025–2034) Bilateral Agreements, including New South Wales, South Australia, Tasmania and the Australian Capital Territory. The agreement sees the Commonwealth increase its share of the Schooling Resource Standard to 25 per cent by 2034–35, putting schools on a path to full and fair funding.

    In exchange, jurisdictions will end their use of the 4 per cent provision which allowed them to claim things like capital depreciation. Instead, this funding will go to delivering reforms, including small group tutoring to help students who fall behind catch up, the introduction of Year 1 phonics and early years numeracy checks and more support to attract and retain teachers.

    Negotiations with jurisdictions who are yet to sign the Bilateral Agreement are continuing, with funding being held in the Contingency Reserve pending finalisation of negotiations.

    This measure builds on the 2024–25 MYEFO measure titled Better and Fairer Schools Bilateral Agreements with Western Australia, Northern Territory, Tasmania and Australian Capital Territory.

    The Government will also provide $11.5 million over four years from 2025–26 to support early childhood education and care and improve educational outcomes in Australian schools.

    Source: Budget Paper No 2, p 37.

    Education – savings

    The Government will achieve savings of $3.0 million over two years from 2024–25 by reallocating funding from the International Education Support program.

    The savings from this measure will be redirected to other Government policy priorities in the Education portfolio.

    Source: Budget Paper No 2, p 38.

    Establishment of Additional University Study Hubs

    The Government will provide funding to establish additional University Study Hubs above the previously committed 20 Regional University Study Hubs and 14 Suburban University Study Hubs.

    The Government will also continue to maintain the MicroCred Seeker website until the end of 2025 to provide continuity of service to students and education providers.

    The cost of this measure will be met from within the existing resourcing of the Department of Education.

    This measure builds on the 2023–24 MYEFO measure titled Australian Universities Accord Interim Report – initial response.

    Source: Budget Paper No 2, p 39

    Employment and Workplace Relations

    Addressing Integrity Risks

    The Government will provide additional funding of $6.0 million over four years from 2025–26 to address critical integrity issues and extend support for retrenched workers. Funding includes:

    • $4.7 million in 2025–26 in additional temporary resourcing to the Australian Skills Quality Authority (ASQA) for urgent enforcement activity to counter fraud in the Vocational Education and Training (VET) sector. This surge resourcing will support ASQA to undertake necessary compliance actions to address serious integrity issues which pose a risk to the community and to the reputation of Australia’s VET sector
    • $1.3 million over four years from 2025–26 to ensure retrenched workers and their partners can continue to access Workforce Australia provider services for a further two years until 30 June 2027.

    The cost of this measure will be met from savings identified in the Employment and Workplace Relations portfolio.

    This measure extends the 2022–23 October Budget measure titled Workforce Australia – micro‑policy amendments and onboarding complementary programs onto the Workforce Australia digital platform.

    Source: Budget Paper No 2, p 40

    Building Australia’s Future – Increased Support for Apprentices

    The Government will provide $722.8 million over four years from 2025–26 to deliver increased support for apprentices. Funding includes:

    • $626.9 million over four years from 2025–26 to reframe the New Energy Apprenticeships Program as the Key Apprenticeship Program and expand it to capture critical residential construction occupations
    • $77.8 million over four years from 2025–26 to extend the current interim Australian Apprenticeship Incentive System program settings for a further six months from 1 July 2025 to 31 December 2025
    • $11.0 million over four years from 2025–26 to increase the Disability Australian Apprentice Wage Support subsidy
    • $7.0 million over four years from 2025–26 to increase the Living Away From Home Allowance.

    The Government’s package of reforms includes six months of consultation to support the development of a new ‘gateway model’ for the incentive system, with costs met from within the existing resourcing of the Department of Employment and Workplace Relations.

    In addition to this, the Government has increased the number of TAFE Centres of Excellence under the National Skills Agreement that are eligible to receive additional funding to fast‑track their establishment.

    The Government has already provided funding for this measure.

    This measure builds on the 2024–25 Budget measure titled Australian Apprenticeships Incentive System – further support and the 2023–24 MYEFO measure titled Employment White Paper.

    Source: Budget Paper No 2, p 41

    Employment and Workplace Relations – savings

    The Government will achieve savings of $7.9 million in 2028–29 by reducing uncommitted funding currently allocated to the Industry Workforce Training program.

    The savings from this measure will fund the 2025–26 Budget measure Addressing Integrity Risks.

    Source: Budget Paper No 2, p 41

    Critical Health Infrastructure and Systems

    The Government will provide funding to secure critical health infrastructure and systems, including:

    • $22.9 million over five years from 2024–25 to address intravenous (IV) fluids shortages by expanding onshore IV fluid production capacity, establishing a panel of suppliers for IV fluids, and undertaking a clinical review of IV fluids
    • $3.7 million over two years from 2025–26 to replace the Cobalt‑60 teletherapy source for the calibration of radiotherapy devices used for radiation therapy
    • $2.4 million over four years from 2025–26 (and $0.6 million per year ongoing) to increase the core operating funding for the National Joint Replacement Registry.

    The Government has already provided partial funding for this measure.

    The cost of this measure will be partially met from within the existing resourcing of the Department of Health and Aged Care and the Australian Radiation Protection and Nuclear Safety Agency.

    The cost of this measure will be partially met from the anticipated recovery of $2.4 million over four years from 2025–26 (and $0.6 million per year ongoing) through changes to the National Joint Replacement Registry Levy.

    This measure builds on the 2024–25 Budget measure titled National Joint Replacement Registry – additional funding.

    Source: Budget Paper No 2, p 45

    Digital Mental Health

    The Government will provide additional funding of $46.0 million over four years from 2024–25 to continue digital mental health services.

    The cost of this measure will be partially met from within the existing resourcing of the Department of Health and Aged Care.

    This measure builds on the 2023–24 MYEFO measure titled Mental Health.

    Source: Budget Paper No 2, p 46

    Even Cheaper Medicines

    The Government will provide $784.6 million over four years from 2025–26 (and

    $236.4 million per year ongoing) to lower the Pharmaceutical Benefits Scheme (PBS) general patient co‑payment from $31.60 to $25.00 on 1 January 2026.

    The measure extends the 2024–25 Budget measure titled Securing Cheaper Medicines and the 2022–23 October Budget measure titled Plan for Cheaper Medicines.

    Source: Budget Paper No 2, p 46

    Funding Pay Increases for Aged Care Workers – nurses

    The Government will provide $88.3 million over five years from 2024–25 (and $0.9 million per year ongoing) to fund the outcome of the Fair Work Commission’s decision to increase the minimum award wages of registered and enrolled nurses employed in the aged care sector.

    The Government will also provide $30.1 million over five years from 2024–25 (and $7.8 million per year ongoing) to fund Commonwealth Home Support Programme providers through a revised approach of an uplift in indexation to existing grant agreements to cover the cost of the increase in award wages from the Fair Work Commission Stage 3 decision on the Aged Care Work Value Case. The funding will move to the Support at Home program when the Commonwealth Home Support Programme rolls into the Support at Home program from no earlier than 1 July 2027.

    The cost of this measure will be partially met from within the existing resourcing of the Department of Health and Aged Care.

    The 2025–26 Budget also includes $2.5 billion over five years from 2024–25 (and an additional $6.1 billion from 2029–30 to 2034–35) to meet the cost of the Fair Work Commission’s decision for aged care nurses with funding to other aged care programs including residential aged care, the Home Care Packages program and the Support at Home program, which will be delivered through increases that will flow through program indexation.

    This measure builds on the 2023–24 Budget and 2024–25 MYEFO measures titled Funding Pay Increases for Aged Care Workers.

    Source: Budget Paper No 2, p 46,47.

    Health – savings

    The Government will achieve savings of $3.8 million over two years from 2025–26 by deferring changes to the Medicare Benefits Schedule (MBS) to reclassify the intravitreal eye injection item as a Type C out‑of‑hospital item, to allow time for further consultation on the proposed changes.

    Source: Budget Paper No 2, p47.

    Implementation of Aged Care Reforms

    The Government will provide $291.6 million over five years from 2024–25 (and an additional $12.7 million in 2029–30) to continue the delivery of aged care reforms and the implementation of recommendations from the Royal Commission into Aged Care Quality and Safety.

    The Government will achieve savings of $21.2 million over three years from 2024–25 by not proceeding with part of the 2022–23 March Budget measure titled Ageing and Aged Care to trial new models of multidisciplinary care in residential aged care and inform pricing arrangements through the National Health Reform Agreement.

    The Government will achieve savings of $27.7 million in 2025–26 through cost recovery activities under the new charging model of the Aged Care Quality and Safety Commission.

    The cost of this measure will be partially met from within the existing resourcing of the Department of Health and Aged Care.

    Source: Budget Paper No 2, p48,49.

    Improving Access to Medicines and Pharmacy Programs

    The Government will provide funding over six years from 2024–25 to improve access to medicines and to trial an expansion of the range of services delivered by community pharmacies.

    The Government has already provided partial funding for this measure.

    The cost of this measure will be partially met from within the existing resources of the Department of Health and Aged Care.

    This measure extends the 2023–24 Budget measure titled Reducing Patient Costs and Improving Services through Community Pharmacies, and builds on the 2024–25 MYEFO measure titled Eighth Community Pharmacy Agreement and the 2024–25 Budget measure titled Securing Cheaper Medicines.

    Source: Budget Paper No 2, p 49,50.

    Medical Research and Clinical Trials

    The Government will provide $158.6 million over five years from 2024–25 to support research and translate medical research to clinical practice.

    The Government has already provided partial funding for this measure.

    The cost of this measure will be partially met from within the existing resourcing of the Department of Health and Aged Care.

    Source: Budget Paper No 2, p 50.

    National Health Reform Agreement – 2025‑26 Uplift

    The Government will provide funding of $33.9 billion in 2025–26 to extend the 2020–2025 Addendum to the National Health Reform Agreement (NHRA) to 30 June 2026.

    The Government has already provided partial funding for this measure.

    Source: Budget Paper No 2, p 51.

    Pharmaceutical Benefits Scheme (PBS) New and Amended Listings

    The Government will provide $1.8 billion over five years from 2024–25 for new and amended listings on the Pharmaceutical Benefits Scheme (PBS), Repatriation Pharmaceutical Benefits Scheme, Stoma Appliance Scheme and Take Home Naloxone program.

    Source: Budget Paper No 2, p 50.

    Preventive Health, Wellbeing and Sport

    The Government will provide $132.0 million in 2025–26 to improve health outcomes through preventive health and other health initiatives.

    The Government has already provided partial funding for this measure.

    The cost of this measure will be partially met from within the existing resourcing of the Department of Health and Aged Care.

    This measure builds on the 2024–25 MYEFO measures titled Preventive Health and 10‑Year National Action Plan for the Health and Wellbeing of LGBTIQA+ People. This measure extends part of the 2023–24 Budget measure Long Term Dental Funding Reform Developmental Work and Interim Funding.

    Source: Budget Paper No 2, p 50.

    Strengthening Medicare

    The Government will provide additional funding of $8.4 billion over five years from 2024–25 (and $2.5 billion per year ongoing) to increase access to bulk billing.

    The Government has also agreed to extend access to temporary Heart Health Assessment items on the MBS to support patients with or at risk of developing cardiovascular disease, pending longer‑term arrangements.

    The Government has already provided partial funding for this measure.

    The cost of this measure will be partially met from within the existing resourcing of the Department of Health and Aged Care.

    This measure builds on the 2022–23 October Budget measure titled Medicare Benefits Schedule – new and amended listings, the 2023–24 Budget measures titled Strengthening Medicare and A Modern and Clinically Appropriate Medicare Benefits Schedule, and the 2023–24 MYEFO measure titled An Effective and Clinically Appropriate Medicare.

    Source: Budget Paper No 2, p 53.

    Strengthening Medicare – Expanding Medicare Urgent Care Clinics

    The Government will provide $657.9 million over three years from 2025–26 to expand the Medicare Urgent Care Clinics Program. This will include an additional 50 Medicare Urgent Care Clinics across Australia, which will take the total number of Medicare Urgent Care Clinics to 137.

    Medicare Urgent Care Clinics reduce pressure on hospital emergency departments by supporting Australians to access care for urgent, but not life‑threatening, conditions. Medicare Urgent Care Clinics are open during extended business hours with no appointments or referrals required, and with no out‑of‑pocket costs for patients.

    The Government has already provided partial funding for this measure.

    This measure builds on the 2024–25 Budget measure titled Strengthening Medicare – Medicare Urgent Care Clinics – additional funding.

    Source: Budget Paper No 2, p 55.

    Strengthening Medicare – Health Workforce

    The Government will provide $662.6 million over five years from 2024–25 (and $230.9 million per year ongoing) to continue to strengthen and support Australia’s health workforce.

    The Government has already provided partial funding for this measure.

    The costs of this measure will also be partially met from within the existing resourcing of the Department of Health and Aged Care.

    Source: Budget Paper No 2, p 56.

    Strengthening Medicare – Women’s Health

    The Government will provide $240.4 million over five years from 2024–25 (and

    $42.3 million per year ongoing) to support women’s health.

    The Government has already provided partial funding for this measure.

    The cost of this measure will be partially met from within the existing resourcing of the Department of Health and Aged Care.

    This measure builds on the 2024–25 Budget measure titled Women’s Health, and the 2022–23 March Budget measure titled Women’s Health Package.

    Source: Budget Paper No 2, p 57.

    Supporting Australian Communities Affected by the Hamas‑Israel Conflict

    The Government will provide $1.6 million over two years from 2024–25 to provide mental health supports and services for Australians impacted by the conflict in the Middle East.

    The cost of this measure will be partially met from within the existing resourcing of the Department of Health and Aged Care.

    This measure extends the 2023–24 MYEFO measure titled Supporting Australian Communities Affected by the Hamas‑Israel Conflict.

    Source: Budget Paper No 2, p 58.

    Disaster Support

    The Government will provide $28.8 million over two years from 2024–25 to improve Australia’s resilience to natural hazards and preparedness to respond to disasters.

    The support outlined in this measure is in addition to assistance provided under the Disaster Recovery Funding Arrangements through which the Australian Government provides funding to states and territories to share the financial burden of responding to significant natural disasters, and the provision of urgent financial assistance to disaster‑affected individuals.

    In addition to the funding announced by the Government to date, the 2025–26 Budget includes a provision of $1.2 billion over the forward estimates to accommodate additional expenditure on disaster response payments including following Ex‑Tropical Cyclone Alfred in March 2025.

    This measure builds on the 2024–25 MYEFO measure titled Disaster Support.

    Source: Budget Paper No 2, p 59.

    Building a Better Future Through Considered Infrastructure Investment

    The Government will provide $17.1 billion over ten years from 2024–25 for road and rail infrastructure priorities to support productivity and jobs.

    The Government will also provide $12.0 million over two years from 2025–26 for the Port Augusta Wharf Refurbishment.

    The Government has already provided partial funding for this measure.

    The cost of this measure will be partially met from existing funding for the Infrastructure Investment Program.

    This measure builds on the 2024–25 MYEFO measure titled Building Australia’s Future – Building a Better Future Through Considered Infrastructure Investment.

    Source: Budget Paper No 2, p 66.

    Building Australia’s Future – Completing the NBN Fibre Upgrades

    The Government will provide an equity investment of up to $3.0 billion over seven years from 2024–25 to NBN Co to upgrade the remaining 622,000 National Broadband Network (NBN) premises on the national fibre‑to‑the‑node (FTTN) network with NBN Co also contributing more than $800 million to the project.

    The additional investment will support more than 94 per cent of Australia’s fixed line footprint to have access to gigabit speeds by 2030.

    The Government has already provided funding for this measure.

    Partial funding for this measure will be held in the Contingency Reserve until final project details are settled.

    This measure builds on the 2022–23 October Budget measure titled Improving the NBN.

    Source: Budget Paper No 2, p 67.

    Continued Funding for the Regional Australia Institute

    The Government will provide $2.0 million in 2025–26 for the Regional Australia Institute to continue research, policy and educational activities.

    Source: Budget Paper No 2, p 67.

    Extend the School Student Broadband Initiative until 2028

    The Government will provide $5.3 million over four years from 2024–25 to continue the delivery of free broadband for up to 30,000 unconnected families with school aged students under the School Student Broadband Initiative to 30 June 2028. More than a third of the families connected under the scheme to date have been in rural and regional Australia.

    Source: Budget Paper No 2, p 68.

    Supporting Connectivity

    The Government will provide $1.8 million in 2025–26 to continue the Measuring Broadband Australia program to assist consumers to make informed choices about broadband services.

    Source: Budget Paper No 2, p 69.

    Supporting Transport Priorities

    The Government will provide $49.6 million over five years from 2024–25 to support transport priorities.

    Source: Budget Paper No 2, p 69.

    Buy Australian Campaign

    The Government will provide $20.0 million in 2025–26 to the Department of the Prime Minister and Cabinet for initiatives to encourage consumers to buy Australian‑made products.

    Source: Budget Paper No 2, p 69.

    Additional Support for the Housing Services Sector

    The Government will provide $8.9 million over three years from 2025–26 to improve and expand support services for vulnerable Australians, including Australians experiencing housing insecurity and family, domestic and sexual violence.

    The Government has already provided partial funding for this measure, and the remainder of the cost will be met from within the existing resourcing of the Department of Social Services.

    Parts of this measure support the implementation of the National Plan to End Violence Against Women and Children 2022–32.  This measure builds on the 2024–25 MYEFO measures titled Housing Support, Ending Gender Based Violence – National Cabinet and Ending Gender Based Violence – additional investment.

    Source: Budget Paper No 2, p 72.

    Strengthening the National Disability Insurance Scheme

    The Government will provide additional funding of $175.4 million over four years from 2025–26 (and $43.8 million per year ongoing) to further safeguard the integrity of the National Disability Insurance Scheme (NDIS) and support people with disability.

    The Government has already provided partial funding for this measure.

    This measure builds on the 2022–23 October Budget measure titled Plan for the National Disability Insurance Scheme, the 2023–24 Budget measure titled Improving the Effectiveness and Sustainability of the National Disability Insurance Scheme, the 2024–25 Budget measure titled National Disability Insurance Scheme – getting the NDIS back on track, and the 2024–25 MYEFO measure titled National Disability Insurance Scheme Reform.

    Source: Budget Paper No 2, p 72, 73.

    Support for People with Disability

    The Government will provide $423.8 million over five years from 2024–25 (and $150.0 million per year ongoing) to support inclusion and build the capacity of people with disability and their families through improving accessibility, delivery of inclusive community services, and general understanding of disability.

    Source: Budget Paper No 2, p 73.

    Energy Bill Relief Fund Extension

    The Government will provide $1.8 billion over two years from 2025–26 to continue energy bill rebates of $75 per quarter for eligible Australian households and small businesses until 31 December 2025 to provide cost-of-living relief.

    This measure extends the 2024–25 Budget measure titled Energy Bill Relief Fund – extension and expansion.

    Source: Budget Paper No 2, p 75.

    Housing Support

    The Government will provide $58.8 million over five years from 2024–25 to increase support for housing.

    The Government will also provide $0.8 billion in additional investment in the Help to Buy program, bringing total equity investments to $6.3 billion, through increasing property price caps and increasing income caps from $90,000 to $100,000 for singles and from $120,000 to $160,000 for joint applications.

    This measure builds on the 2024–25 Budget measure titled Housing Support.

    Source: Budget Paper No 2, p 73.

    National Anti‑Scam Centre

    The Government will provide $6.7 million in 2025–26 to extend the operation of the National Anti‑Scam Centre within the Australian Competition and Consumer Commission to continue protecting consumers and businesses from scam activity.

    This measure builds on the 2023–24 Budget measure titled Fighting Scams.

    Source: Budget Paper No 2, p 76.

    Small Business and Franchisee Support and Protection

    The Government will provide $12.0 million over four years from 2025–26 to support and protect small businesses. Funding includes:

    • $7.1 million over two years from 2025–26 for the Australian Competition and Consumer Commission to strengthen regulatory oversight of the Franchising Code of Conduct
    • $3.0 million over four years from 2025–26 for the Australian Securities and Investments Commission to improve its data analytics capability to better target enforcement activities to deter illegal phoenixing activities, particularly in the construction sector
    • $1.2 million in 2025–26 to partner with White Box Enterprises to establish a Social Enterprise Loan Fund to offer small loans to social enterprises, including work integration social enterprises, to support employment for disadvantaged Australians
    • $0.8 million in 2025–26 for Treasury to develop and consult on options to extend protections against unfair trading practices to small businesses and protect businesses regulated by the Franchising Code of Conduct from unfair contract terms and unfair trading practices.

    The Government has already provided partial funding for this measure.

    The cost of this measure will be partially met from within the existing resofurcing of the Treasury.

    Source: Budget Paper No 2, p 76.

    Treasury Portfolio – additional resourcing

    The Government will provide $219.2 million over four years from 2025–26 to support the delivery of Government priorities in the Treasury portfolio, including:

    • an increase in the cap on the Commonwealth’s guarantee of Housing Australia’s liabilities from $10 billion to $26 billion including support for commitments for projects under the Housing Australia Future Fund and the National Housing Accord Facility
    • $207.0 million over two years from 2025–26 to deliver the second tranche of stabilisation and uplift of the Australian Securities and Investments Commission’s (ASIC) business registers
    • $4.6 million over four years from 2025–26 to continue the National Housing Delivery Coordinator
    • $3.9 million in 2025–26 for the Australian Competition and Consumer Commission to extend the National Electricity Market Inquiry and enforcement activities to protect consumer price outcomes and ensure electricity providers comply with their obligations
    • $2.9 million over three years from 2025–26 to assist fresh produce suppliers to understand and enforce their rights under the Food and Grocery Code to achieve more favourable commercial outcomes when negotiating with large grocery businesses
    • $0.8 million in 2025–26 for the Treasury to reform Australia’s financial reporting governance arrangements.

    The Government will also amend the application of indexation to certain fees under the Corporations (Review Fees) Act 2003.

    The cost of this measure will be partially met from within the existing resourcing of the Housing portfolio.

    Source: Budget Paper No 2, p 78.

  • Understanding Asset Allocation: Building a Portfolio That Works for You

    Understanding Asset Allocation: Building a Portfolio That Works for You

    Asset allocation is all about finding the right balance for your investments.

    By dividing your portfolio among different asset types – shares, bonds, and cash – you can create a strategy that helps you grow your wealth while managing risk. It’s a key step in taking control of your financial future.

    What Is Asset Allocation?

    Think of asset allocation as the mix of ingredients in a recipe. Each asset class – stocks, bonds, cash, or even real estate – adds something unique to your portfolio. Shares may offer high growth potential, bonds provide steady income, and cash ensures stability. The right mix depends on your goals and comfort level with risk.

    Why Does It Matter?

    1. Manages Risk: Spreading your investments across different assets reduces the impact of one underperforming.
    2. Matches Your Goals: Whether saving for retirement or a big purchase, your asset mix should align with what you want to achieve.
    3. Adjusts Over Time: Life changes – and so should your portfolio. Younger investors might lean toward growth-focused assets, while retirees often prioritise stability.
    4. Handles Market Ups and Downs: Diversification helps your portfolio stay steady, even when markets get bumpy.

    Finding Your Perfect Balance

    • Understand Your Risk Tolerance: Are you comfortable with market ups and downs? This guides how much you invest in higher-risk options like stocks.
    • Set Clear Goals: Saving for a house in five years? Planning for retirement in 30? Your timeline shapes your choices.
    • Rebalance Regularly: Over time, your portfolio might shift. Checking in periodically helps keep it on track.

    The Impact on Your Portfolio

    A well-balanced portfolio is like a sturdy ship: it weathers the storms while keeping you on course. Shares might soar during a market rally, while bonds offer stability in a downturn. Together, they work to smooth out the ride and support long-term growth.

    Asset allocation isn’t a one-time task – it’s an ongoing process. Whether you’re just starting or revisiting your strategy, staying balanced and focused on your goals is key.

    Need guidance? A LT financial adviser can help tailor a plan that’s right for you. Remember, the journey to financial success starts with a solid foundation. Click here for more information about our Financial Advisory Firm.

    Disclaimer
    The information contained in this publication is for general information purposes only, professional advice should be obtained before acting on any information contained herein. Neither the publishers nor the distributors can accept any responsibility for loss occasioned to any person as a result of action taken or refrained from in consequence of the contents of this publication.

  • Understanding Division 293 Tax: What High-Income Earners Need to Know

    Understanding Division 293 Tax: What High-Income Earners Need to Know

    Division 293 tax is an additional tax on concessional superannuation contributions for high-income earners in Australia.

    It is applied at a rate of 15% on certain super contributions when an individual’s combined income and concessional contributions exceed $250,000 in a financial year.

    This tax effectively reduces the tax concession available to higher-income individuals, ensuring a more equitable distribution of superannuation tax benefits.

    How Division 293 Tax Works
    Concessional (before-tax) super contributions are usually taxed at 15%. However, if an individual’s Division 293 income plus their concessional contributions exceed $250,000, an additional 15% tax is levied on the portion that exceeds this threshold. This brings the total tax on these contributions to 30%.

    What Counts as Division 293 Income?
    To determine whether you exceed the $250,000 threshold, the Australian Taxation Office (ATO) considers a range of income sources, including:
    • Taxable income (assessable income minus allowable deductions)
    • Total reportable fringe benefits amounts
    • Net investment and rental property losses
    • Income from trusts
    • Super lump sum amounts taxed at a zero rate
    • Assessable first home super saver released amounts
    These amounts are totaled to calculate your Division 293 income. However, super lump sum taxed elements and assessable first home super saver released amounts are subtracted from the total.

    One-off payments such as redundancy payouts and capital gains can also push an individual’s income above the $250,000 threshold in a particular year, even if they typically earn less.

    These events include:
    • Receiving a redundancy or termination payment
    • Making a capital gain (e.g., from selling an investment property or shares)
    • Earning a significantly higher income in one year due to bonuses or other payments
    If your income exceeds the threshold due to one of these events, you may have to pay Division 293 tax for that year, even if your income is lower in other years.

    Which Contributions Are Taxed Under Division 293?
    Division 293 tax applies to concessional super contributions, which include:
    • Employer contributions (including Superannuation Guarantee (SG) payments)
    • Salary-sacrificed contributions
    • Personal deductible contributions
    • Certain roll-over superannuation benefits
    However, excess concessional contributions (contributions that exceed the standard concessional cap) are disregarded for Division 293 tax purposes. If an individual carries forward unused concessional cap amounts from previous years, all contributions within the higher cap are still counted for Division 293 calculations.

    How Division 293 Tax is Calculated
    The Australian Taxation Office (ATO) assesses Division 293 tax using both:

    1. Your income tax return – to determine Division 293 income
    2. Super fund contribution reports – to determine Division 293 concessional contributions
      The tax is then calculated as 15% of the lower of:
      • The amount over the $250,000 threshold
      • The taxable concessional contributions
      For example, if an individual has a Division 293 income of $260,000 and concessional contributions of $20,000, the excess income above the threshold is $10,000. Since this is lower than the concessional contributions, the additional 15% tax applies to $10,000, resulting in a $1,500 Division 293 tax liability.

    Receiving and Paying Division 293 Tax Notices
    If you are liable for Division 293 tax, the ATO will issue a Division 293 notice of assessment after receiving your super fund’s tax return and contribution details.
    Payment options include:
    • Paying the tax directly from personal funds
    • Releasing money from your superannuation account
    Paying on time helps avoid interest charges.

    Can You Avoid Division 293 Tax?
    Unfortunately, Division 293 tax cannot be avoided if your income exceeds the threshold. However, tax planning strategies—such as reducing taxable income through deductions or structuring salary-sacrificed contributions—can help keep your total income under $250,000 and minimise liability.

    Disputing a Division 293 Tax Assessment
    If you believe you have been incorrectly assessed, check the reported income and contribution amounts on your Division 293 notice. Errors in tax returns or super fund reporting can sometimes lead to miscalculations. You can correct mistakes by:
    • Amending your tax return
    • Contacting your super fund to verify reported contributions
    • Lodging an objection with the ATO if the assessment appears incorrect
    Division 293 tax is designed to limit superannuation tax concessions for high-income earners, ensuring a fairer tax system.

    While it increases the tax burden on those earning above $250,000, it is still more favourable than paying the highest marginal tax rate of 47%. Even if you have to pay Division 293 tax, the 30% tax rate on concessional contributions is still lower than the top marginal tax rate of 47%, making superannuation a tax-effective investment.

    If the Division 293 tax may apply to you, consider speaking with a LT financial adviser or LT tax professional to explore strategies to optimise your super contributions and tax position.

  • FBT Preparation (What You Need To Do Before 31 March)

    FBT Preparation (What You Need To Do Before 31 March)

    As 31 March approaches, businesses need to prepare for their Fringe Benefits Tax (FBT) obligations to ensure compliance with the Australian Taxation Office (ATO).

    The FBT year runs from 1 April to 31 March, and preparing ahead of time can help businesses avoid costly mistakes, reduce their FBT liability, and ensure all required records are in place.

    Whether you’re providing company cars, entertainment benefits, or employee loans, here’s what you need to do before the FBT year-end.

    1. Review Your Fringe Benefits

    A fringe benefit is any non-cash benefit provided to employees (or their associates, such as family members) in connection with their employment. Some common types of fringe benefits include:

    • Company cars used for private purposes
    • Entertainment expenses, such as meals, tickets, and events
    • Employee loans with low or no interest
    • Salary packaging arrangements
    • Housing benefits or rent assistance

    What You Should Do: Identify all fringe benefits provided during the FBT year and determine their taxable value.

    2. Ensure Accurate Record-Keeping

    The ATO requires businesses to keep proper records to support FBT calculations. Before 31 March, make sure you have:

    • Logbooks for company vehicles (if using the operating cost method)
    • Receipts and invoices for entertainment expenses
    • Employee declarations (e.g., if employees make contributions towards benefits)
    • Documentation for salary sacrifice arrangements

    What You Should Do: Double-check that all required records are complete and up to date.

    3. Assess the Taxable Value of Benefits

    The value of fringe benefits can be calculated using different methods, depending on the type of benefit. Some benefits have specific valuation rules, while others allow businesses to choose between methods.

    For example:

    • Company cars: Use either the statutory method (based on a percentage of the car’s cost) or the operating cost method (based on actual running costs and business use percentage).
    • Entertainment: The actual cost method or 50/50 split method can be used.
    • Loans to employees: Interest rates should be compared to the benchmark interest rate set by the ATO.

    What You Should Do: Determine the best valuation method for each benefit to minimise your FBT liability.

    4. Consider Employee Contributions

    Employees can reduce the FBT liability on certain benefits by making post-tax contributions. For example, if an employee reimburses the business for private car use, the taxable value of the benefit is reduced.

    What You Should Do: If applicable, ensure employee contributions are processed before 31 March and properly documented.

    5. Identify Available FBT Exemptions & Reductions

    Some benefits are exempt from FBT or receive concessional treatment, including:

    • Work-related items such as laptops, phones, and tablets
    • Public transport or parking benefits under certain conditions
    • Benefits provided to employees of not-for-profit organisations (which may have FBT concessions)

    Additionally, small businesses (with turnover under $50 million) can access exemptions on certain work-related portable devices.

    What You Should Do: Review whether your business qualifies for any exemptions or reductions to lower your FBT liability.

    6. Prepare for Lodgement and Payment

    The FBT return is due by 21 May 2025 if lodged manually, or by 25 June 2025 if lodged electronically through a tax agent. Any FBT payable should be accounted for in your business’s financial planning.

    What You Should Do: If your business has an FBT liability, prepare to lodge the return on time and set aside funds for payment.

    Preparing for FBT before 31 March ensures compliance, reduces tax liabilities, and prevents last-minute stress. Businesses can effectively manage their FBT obligations by reviewing fringe benefits, keeping accurate records, considering valuation methods, and identifying exemptions.

    If you need help assessing your FBT liability or preparing your FBT return, contact a professional accountant to ensure you’re meeting all requirements while minimising costs.

    We’re here to help – find out how.