When choosing an accountant, it can be tempting to focus only on the price. However, the cheapest tax return may not provide the best financial outcome. At Impact Taxation & Financial Services, we do more than enter figures and lodge a return — we review your circumstances, identify legitimate deductions, and ensure your tax affairs are structured for the best possible outcome.
Case Study: Around $35,000 in Tax Saved Per Year Through Amendments
We helped a client achieve approximately $35,000 in tax savings per year across three financial years after reviewing the tax treatment of their investment trading activities.
The client’s previous accountant had treated the trading losses as capital losses, meaning they were carried forward and could generally only be applied against future capital gains.
After reviewing the client’s circumstances and trading activities, we determined that the client qualified for tax treatment as a share trader. This meant the relevant losses could be treated as revenue losses rather than capital losses. We amended the previous tax returns — resulting in approximately $35,000 in tax savings per year for three years.
This is a strong example of why the correct tax treatment can make a significant difference, particularly when your investment activities become more complex.
Case Study: Approximately $24,000 Saved Through a Franked Dividend Strategy
We also recently helped a business client achieve approximately $24,000 in tax savings by reviewing how they were taking income from their company.
Previously, the client had been paying themselves primarily through salary and wages, while a significant amount of accumulated profit remained in the company without a clear distribution strategy.
As part of our tax planning, we restructured the way they received income — reducing salary and paying part of their income through franked dividends, allowing them to make effective use of the company’s available franking credits. The result was approximately $24,000 in tax savings, along with a more effective strategy for accessing accumulated company profits.
This is a good example of why business owners should look beyond simply asking: “How much salary should I pay myself?” The better question is: “What is the most tax-effective way to take money out of my business?”
Are You Building Wealth or Just Earning More Income?
A high income does not necessarily mean you are building wealth. We often see high-income earners paying significant amounts of tax while their lifestyle expenses increase along with their income. The key is turning income into assets that build wealth over time.
Instead of only asking “How much am I earning?”, consider asking: “How much of what I earn am I actually keeping and turning into long-term wealth?”
Get a Second Opinion
If you have never had your tax returns or business structure independently reviewed, it may be worth getting a fresh perspective. Call us on 1300 TAX SAV (1300 829 728) or contact us here for a complimentary initial consultation.
General information only. Tax outcomes depend on individual circumstances and cannot be guaranteed.
