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Tax Minimisation Strategies

Companies

  • Tax Losses – Check to see if your company has any tax losses carry forward from prior years. These will be able to be offset against this year's income. You'll need to make sure that the company passes either the Continuity of Ownership or the Same Business test.
  • Loans treated as dividends – Companies are allowed to make loans or payments to their shareholders or associates (or even forgive debts). There are onerous tax and legal consequences, unless the loans are legitimate with proper loan agreements in place, interest being charged, principal repayments made and, in some case, genuine security taken. Alternatively, the loan can be repaid by the earlier of the due date for lodgement of the company's return for the year or the actual lodgement date. It's important to get good tax advice, particular to your company or risk severe tax and legal consequences.
  • Tax Consolidation – If you've got a few companies that make up your group, you may want to consider consolidating them for tax purposes before the end of the year. The resultant single tax entity allows you to offset profits and losses from the different entities.
  • Personal Services – The company tax rate on income is currently 30% (2014/15 year). Individual tax rates can be much higher. If you provide services through a company where those services are virtually all from your personal exertion, you could well find that the income will be considered to be all yours and not the company's. There are a couple of hoops to jump through to make sure that the income is treated as income of the company. You need to look at these well before the end of the tax year to give you time to comply.

Please contact your nearest Murray Nankivell office to book an appointment today to help us understand your specific situation and work with you to select the best strategies to help you minimise your tax bill.

The information on this website is general information only, and Murray Nankivell is, by means of this information, not rendering professional advice or services. This information has been prepared without considering your circumstances and you should seek specific tax advice about your own circumstances.

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Joel Thomas

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Joel Thomas
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