2024-25 EOFY Tax Planning tips for individuals

Taxpayers who own an investment property or have an investment portfolio margin loan may consider prepaying interest up to 12 months in advance (service period ending prior to 30 June 2024) on investment loans and claiming a deduction in the 2024 year for the prepayment.

The ATO have revised the fixed rate method to calculate work from home expenses and has changed the requirements of records required to keep. Speak to your RSM Advisor for more details.

If you frequently use your own vehicle for work related travel, a logbook may increase your motor vehicle deduction.

A logbook must be kept for 12 consecutive weeks and must be updated every five years or whenever your vehicle use materially changes. In addition to maintaining a logbook ensure you keep written evidence of all motor vehicle expenses such as insurance, services, license and registration paid during the 2024 financial year.

If you do not maintain a logbook the maximum kilometres an employee will be entitled to claim is 5,000 kilometres at a rate of 85 cents for the 2024-25 financial year. 

It is important to note, in most cases, home to work travel is not included as work related.

A donation to a Deductible Gift Recipient (DGR) may be a great way to reduce your taxable income while contributing to a good cause.

If you intend to make a donation prior to 30 June 2024, ensure that the donation is made to a DGR and that you maintain the receipt. A list of DGRs are available on the ATO’s website.

If your income protection policy is owned by you personally it is an income tax deduction in your individual tax return.

It may be wise talking to your financial adviser about your income protection policy being in your personal name instead of your superannuation fund to result in a personal tax deduction. In addition, to increase your deduction it may be beneficial to pay your policy annually prior to year-end instead of monthly.

You may consider reviewing any capital gains made during the financial year. 

If you have had a capital gains tax event during the year, evaluate any other assets you hold that are in a loss position and consider if it is an appropriate time to sell these to reduce your capital gains tax exposure.

Be aware that individuals have access to the 50% capital gain concession if they hold an asset for more than 12 months.

Just before the financial year end is a great time to do a financial check of your funds and if you have any excess cash it might be worthwhile investing in your retirement and topping up your superannuation fund.

Any concessional contributions made into your superannuation fund up to the cap of $27,500 is an income tax deduction against your assessable income. Since 1 July 2017 you are now able to make concessional contributions to your superannuation fund regardless of how your income was received. This means even if you are not self-employed you can still make an eligible concessional contribution and have the amount deductible in your tax return.

You must be aged under 67 to make personal concessional contributions, unless you pass the work test (40 hours work in any 30 consecutive day period during the year), in which case you must be no older than 75.

The annual concessional contributions cap is now $27,500 for all individuals. 

Superfund members with a total super balance (the total of all superannuation accounts you may have) under $500,000 as at 30 June in the previous financial year, can use previously unused concessional caps over five years. If the cap isn’t utilised in a year the unused amount can be carried forward up to five years. However, any unused amounts expire after five years, the used cap amount from the 2019 year will expire this year at the end of this financial year.

If you have had more than one job during the financial year you should make sure that you have not exceeded your concessional contribution cap as excess contribution amounts will be taxed at your marginal tax rate (less a 15% tax offset) plus an excess concessional contributions charge.

To claim a deduction for superannuation contributions in your income tax return you must provide a signed notice (Section 290-170 notice) to your superannuation fund to notify them of your intention. You must receive an acknowledgement notice from the fund confirming your contribution, prior to the lodgement of your individual income tax return.

From 1 July 2022, members under 75 years of age may be able to make non-concessional contributions subject to a yearly cap of $110,000 or up to $330,000 over a three-year period depending on their total superannuation balance.

Contribution and ‘bring forward’ available to members under 75:

Members are not eligible to make non-concessional contributions once they are 75 or older. 

Due to the strict rules and regulations around superannuation funds and member contributions we advise you to contact us prior to making any non-concessional contributions as excess
contributions will be taxed at 47%.

If you are on a lower income and earn at least 10% of your income from employment or carrying on a business and make a “non-concessional contribution” to super, you may be eligible for a Government co-contribution of up to $500.

In 2024, the maximum co-contribution is available if you contribute $1,000 and earn $43,446 or less. A lower amount may be received if you contribute less than $1,000 and/or earn between $43,446 and $58,445.

Individuals whose combined income and concessional contributions for Division 293 purposes is more than $250,000 will be subject to an additional 15% tax on their taxable superannuation contributions. 

Singles and families who do not have adequate private health insurance cover will be liable for the Medicare levy surcharge. 

This is determined by the income thresholds, set out in the table below.

Note: The family income threshold is increased by $1,500 for each dependent child after the first child.

Ensure you have appropriate private health insurance going forward to avoid paying the Medicare levy surcharge.