As the end of the financial year (EOFY) approaches, smart tax planning can make a real difference to your business’s bottom line. With rising operating costs and economic uncertainty continuing to impact small businesses across Australia, taking proactive steps now can reduce your tax liability, improve your cash flow, and create breathing room for the year ahead.
EOFY is more than just a compliance deadline. It’s a chance to strengthen your financial position. The Australian Government provides a range of tax incentives and concessions specifically for small businesses, including instant asset write-offs, prepaid expense deductions, and early superannuation payments. But many of these strategies need to be actioned before 30 June.
Below, we’ve outlined some of the most effective EOFY planning strategies for small business owners.
Take Advantage of Instant Asset
Write Offs
Review Expenses and Prepayments
Consider prepaying expenses like rent, insurance, utilities, and professional subscriptions before 30 June to claim a deduction in this financial year. Prepayments for up to 12 months in advance are generally deductible immediately. This strategy can bring forward deductions to reduce this year’s taxable income, which is particularly beneficial if you’ve had a profitable year. It also helps smooth cash flow by managing upcoming expenses proactively.
Pay Employee Superannuation Early
Superannuation contributions for employees must be received by the super fund before 30 June to claim a deduction this year. Processing payments a few days early is essential, as transfer delays can cause missed deductions. Also, remember that the Super Guarantee rate is currently 11% (2024-2025), and late payments are not tax deductible. Paying on time not only helps your team but also ensures full tax benefits and avoids penalties.
Write Off Bad Debts
Review your accounts receivable and identify genuinely unrecoverable debts to write off before 30 June. To claim the deduction, the debt must have been previously included as assessable income and must be formally written off in your accounts. Keep documentation that shows genuine recovery attempts. Writing off bad debts reduces your taxable income immediately and can also help clean up your balance sheet for the new financial year.
Consider Temporary Full Expensing
Under the temporary full expensing measure, eligible businesses with an aggregated turnover of less than $5 billion can claim an immediate deduction for the full cost of eligible depreciating assets. This includes new assets and improvements to existing assets. This is a significant opportunity for businesses planning to invest in machinery, vehicles, or technology upgrades, as it can result in substantial tax savings and faster capital reinvestment cycles.
Review Your Business Structure
The end of the financial year is an ideal time to assess whether your current business structure, whether sole trader, partnership, company, or trust, still aligns with your growth, risk management, and tax planning goals. For example, moving to a company or trust structure might offer tax flexibility, asset protection, and better succession planning. The right structure can reduce tax exposure, allow income splitting, and provide access to small business concessions like the 25% company tax rate (2024-2025) for base rate entities.
We’re here to help
At Pisani Group, we work closely with small businesses across South Australia to tailor tax strategies that support their goals. If you want to maximise your deductions and strengthen your cash flow, our team is here to help.
