Most business owners know about common tax deductions like motor vehicle expenses, office supplies, and depreciation. However, some of the biggest tax-saving opportunities are often the ones that are overlooked.
Here are six strategies we regularly discuss with our business clients.
1. Office Meals and Refreshments
Not all food and drink expenses are considered entertainment. In some situations, workplace refreshments may be tax deductible and exempt from Fringe Benefits Tax (FBT). The key is understanding how the ATO distinguishes between entertainment and genuine workplace refreshments.
2. The Minor Benefits Exemption
Benefits costing less than $300 — such as gift cards, hampers, and event tickets — may qualify for the FBT minor benefits exemption when the conditions are met. Many businesses miss this because they assume any benefit provided to employees will attract FBT.
3. Travel Allowance Planning
A properly structured travel allowance can simplify record-keeping and maximise eligible travel deductions, provided the ATO requirements are satisfied. This is an area where getting the structure right from the outset can make a meaningful difference at tax time.
4. Franking Credit Refunds
Many business owners overlook the value of franking credits. Depending on your tax position, excess franking credits may even be refunded by the ATO. Understanding how franking credits flow through your structure can unlock significant tax benefits that would otherwise be left on the table.
5. Employing Family Members
Where family members genuinely work in the business and are paid a commercial wage, this can be an effective way to support the business while improving the family’s overall tax position. Salaries paid to family members — including children under 18 where eligible — need to be structured correctly to meet ATO requirements.
6. Business Structure Review
As your business grows, your existing structure may no longer be the most tax-effective. A review can identify opportunities for better tax outcomes, stronger asset protection, and improved succession planning. What worked when you started may be costing you more tax than necessary today.
Don’t Wait Until Tax Time
The best tax planning opportunities are usually identified before the end of the financial year — not after your tax return has been lodged. If you are wondering whether you are paying more tax than necessary, it may be time for a second opinion.
At Impact Taxation & Financial Services, we work proactively with our clients to ensure their structure and deductions are working as hard as possible for them. Call us on 1300 TAX SAV (1300 829 728) or get in touch here for a complimentary initial consultation.
