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Jun05

Preparing for End Of Financial Year - EOFY

Friday, June 05, 2015

 

With the end of the financial year on our doorsteps, its a good time to reflect on your financial situation.

Here is a list of common changes to consider...

Has your income changed?

The income you received during the year may not be the same as when your advice was put in place. Maybe you received a pay increase, earned some overtime or received other payments such as extra commission or a bonus. How might this affect you?

If you are making salary sacrifice contributions to super

There is a limit, known as the concessional contributions cap, on the amount you can contribute to superannuation each year from your pre-tax income. Contributions your employer makes on your behalf, such as Superannuation Guarantee and salary sacrifice contributions, count towards this limit.
If you have arranged with your employer to contribute part of your salary to superannuation via a salary sacrifice arrangement, it is important to review your contributions to ensure they are still within the concessional contribution cap.

If, for example, you’ve earned more than expected then the amount you have salary sacrificed, together with the compulsory contributions made by your employer, may be in excess of the contributions cap. This could result in additional tax penalties and administration issues. Detecting this before the end of the year can allow time to minimise any impacts.

Making tax deductible personal super contributions

You must meet certain criteria to be eligible to claim a tax deduction for a personal superannuation contribution you make. If you haven’t earned as much as you thought:

You may not to be able to claim a deduction for the full amount of the contribution. You can only claim a tax deduction for your contribution if you have assessable income to offset.

Will your spouse earn less than $13,800 this year?

If your spouse has a low income, you may be eligible to claim a tax offset of up to $500 after making a contribution to their superannuation fund. Tax offsets have a greater impact on your underlying tax liability than deductions because they directly reduce your tax bill dollar by dollar – rather than deductions which simply reduce the income you include in your tax return.

Is your insurance still appropriate for you?

Have any of these happened to you through the year?

  • A change in your salary
  • The purchase of a new home
  • Changes to your home loan repayments – such as an increase in your rate of repayment or lump sum repayments
  • Purchase of an asset funded by borrowings
  • Marriage or divorce
  • New children.

If so, you may need to review your insurance cover.

Do you have a self managed super fund (SMSF)?


You’ll be aware that having an SMSF means you have extra responsibilities as trustee of the fund. As 30 June approaches, two important considerations include:

  • If you are in pension phase, have the minimum pension payments requirements been met?
  • If your SMSF is receiving contributions from an unrelated employer, it must be able to receive contribution information through the new SuperStream data standards. If you have recently changed employers or intend to change employers, it’s important to make sure your fund can receive contributions using the data standards so you are not in breach of your duties.  


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