Get Ready For Tax Time 2025

Get Ready For Tax Time 2025

With tax time fast approaching for the 2024–25 financial year, it’s a great time to get your finances in order. Whether you’re a salaried worker, small business owner, investor or retiree, preparing ahead can help you reduce stress and improve your return. If you’re in Adelaide, understanding both national rules and state-specific considerations can make a real difference.

Start by reviewing all your income sources. This goes beyond your regular job, include freelance income, investment earnings, rental property income, dividends, and any government payments. If you’re running a business or working as a sole trader, make sure your bookkeeping is up to date and accurate. Knowing exactly what you’ve earned throughout the year means you’ll have a clearer view of your tax obligations and be less likely to overlook anything important.

When it comes to expenses, claiming all eligible deductions is one of the best ways to reduce your taxable income. For employees, this might include car and travel expenses, uniforms, training or education directly related to your current role, and home office costs. The ATO continues to update its guidelines on claiming working-from-home expenses, so make sure you’re following the latest method, currently the fixed rate of 67c per hour applies, covering things like electricity, internet and phone usage. Just remember: you’ll need a detailed log of your working hours and evidence of actual costs.

Property, investments, and CGT timing

If you own shares, cryptocurrency or property, consider your capital gains position. Timing can play a big part in how much tax you’ll owe. Selling an asset you’ve held for more than 12 months may make you eligible for a 50% capital gains tax discount. But if the value has dropped, you might also choose to realise a capital loss which could be used to offset gains made elsewhere.

Adelaide investors with rental properties should double-check that all income and expenses are recorded accurately. Deductible costs can include interest on loans, rates, maintenance, insurance, property management fees and depreciation on certain fixtures. The ATO often targets rental property claims, so make sure your records are thorough and match what’s being claimed.

Don’t forget donations and Medicare obligations

Charitable donations over $2 to registered Australian charities are tax-deductible. The donation must be made without receiving anything in return (like a raffle ticket or gift), and you’ll need to keep receipts. These can add up over the year and help reduce your taxable income, just make sure the organisation has Deductible Gift Recipient (DGR) status.

Another often-missed area is the Medicare levy and surcharge. Most Australians pay a 2% Medicare levy, but if your income is above a certain threshold and you don’t have an appropriate level of private hospital cover, you could also be hit with the Medicare levy surcharge of up to 1.5%. Taking out private cover before 30 June could potentially save you hundreds.

Super contributions before EOFY

Voluntary super contributions are still one of the most tax-effective ways to plan for the future. If you’re under the concessional contributions cap ($27,500 for 2024–25), you may be able to reduce your taxable income by making extra contributions, either via salary sacrifice or personal contributions claimed as a tax deduction. If you haven’t maxed out previous years’ caps, you might be eligible to carry forward unused contributions for up to five years, a smart strategy if you’ve had a windfall this year.

Also worth considering: if your spouse earns a low or no income, contributing to their super may give you a tax offset of up to $540, depending on how much you contribute and their income level.

Retirees and older Australians

If you’re receiving income from a super pension or annuity, make sure you understand how it’s taxed. Account-based pensions from a taxed super fund are usually tax-free if you’re aged 60 or over, but if you’ve got income from other sources or are drawing down from multiple funds, it’s worth reviewing your situation.

Make sure you’re also meeting your minimum pension withdrawal requirements. These are age-based and must be met each financial year to keep your pension income stream tax-free.

Tax planning for the self-employed

If you’re self-employed or run a small business in Adelaide, there are a few key areas to focus on before 30 June. Prepaying expenses (like insurance, rent, or subscriptions), writing off bad debts, or upgrading equipment could all help reduce your taxable income this year. Also check if you’re eligible for the temporary full expensing scheme, which allows immediate deduction of the full cost of eligible depreciating assets. This scheme is due to end on 30 June 2025, so now might be a good time to take advantage.

Make sure your records are up to date, particularly for GST, PAYG instalments, and super payments for employees. The ATO is cracking down on businesses that fall behind on obligations, so keeping things clean and current is important.

Getting help

While you can manage a lot of your tax preparation on your own, a registered tax agent or financial adviser can give you personalised advice, help you avoid mistakes, and make sure you’re not missing out on any deductions or credits. Many tax strategies are time-sensitive so it’s worth speaking to someone before 30 June if you want to put them in place this financial year.

Getting ready for tax time doesn’t have to be stressful. A bit of planning now can make a big difference to your return and help set you up for a smoother year ahead.