As we approach the end of the financial year, it’s the perfect time to review your tax position and ensure you’re making the most of available deductions and opportunities. In this article, we’ll walk you through the key tax planning strategies for 2025 that every Australian business owner should consider.
Whether you’re a sole trader or running a company, proactive tax planning could mean more money in your pocket—and fewer surprises come tax time.
Personal Tax Cuts
The Stage 3 personal tax cuts came into effect 1 July 2024, and unfortunately, we won’t see further tax cuts until next year on 1 July 2026.
Instant Asset Write-Off: Extended to 2025
One of the most practical budget measures for small business is the extended Instant Asset Write-Off announced in the budget. The instant write off had been reduced for most small businesses to $1,000 but the budget announcement now has it remaining at $20,000 for the 2024 25 financial year. Both political parties are promising a further extension to the Instant Asset Write off for new financial year, but if you want to obtain the tax saving now; you should secure the deduction this financial year. Keep in mind, if you want the deduction in this financial year, the asset must be paid for, installed and ready for use by 30 June 2025.
This applies to businesses with aggregated turnover under $10 million. It also includes used assets and business-related improvements to assets. However, things like capital works like buildings, non-business assets, and the private-use portion of assets are excluded.
If your business spends more than $20,000 on an asset, you’ll fall under general depreciation rules. If you’re using the simplified depreciation pool, remember the rates: 15% depreciation claim in the first year, and 30% from the second year onward.
Get Ready for Payday Super
Although Payday Super doesn’t start until 1 July 2026, now is the time to prepare. Employers will need to pay super at the same time as wages, instead of quarterly. This will require changes to payroll systems and cash flow planning, especially for businesses currently paying super quarterly.
Electric Vehicles and FBT Exemptions
Providing an electric vehicle to an employee? If the car is under the luxury car threshold ($91,387 in 2025), it may be exempt from Fringe Benefits Tax (FBT). That’s a full tax deduction with no FBT.
This is a generous provision, but it’s due for review in mid-2027, so now may be the time to act.
ATO Audit Focus for 2025
The ATO has received additional funding to expand its compliance programs. This year’s key focus areas include:
- Short-term rental properties (e.g., Airbnb with private use)
- The cash economy (aka the shadow economy)
- Aggressive tax avoidance schemes
- Division 7A Loans
- Retail & Construction
If you’re involved in any of these areas, make sure your documentation is rock solid and seek professional advice before lodging your return.
Trusted Tax Planning Strategies You Shouldn’t Miss
Here’s a checklist of tried-and-true tax tips to consider before 30 June:
✅ Prepay Expenses
Rent, insurance, and subscriptions can usually be prepaid for up to 12 months to bring the deduction into this year.
✅ Write Off Bad Debts & Obsolete Stock
Debts that are over 9 months old and unrecoverable can be written off, as can unsellable stock. Just make sure it’s documented before year-end.
✅ Pay Staff Bonuses & Gifts
Bonuses must be paid before 30 June to be deductible. Gifts under $300 that are infrequent and non-entertainment (e.g., gift cards) are tax deducible and FBT-free.
✅ Pay Super Early
Super must be received by the fund before 30 June to be deductible which means in practice you need to pay it by 25 June. For personal super contributions, the cap is $30,000 but catch-up contributions may apply if your balance is under $500,000.
✅ Finalise Trust Distributions
Trust distribution resolutions must be signed before 30 June. If you don’t get this right, the trustee may be taxed at 45%. We will provide our BAS Trust clients with the needed documentation in mid June and we will provide out tax only Trust clients with a proforma for completion before 30 June.
✅ Logbooks & Odometer Readings
If you’re claiming vehicle expenses via the logbook method, don’t forget to record your odometer reading at 30 June.
✅ Structure Review
EOFY is a great time to review your business structure. Does it still meet your needs for growth, risk, and tax efficiency? We will look at this with you in our year end tax planning meetings. Keep an eye out for your email invitation.
Final Reminders: Substantiation & Intent
For every claim, ensure you have:
- A valid tax invoice or receipt, and
- Proof of payment (e.g., bank or credit card statement)
Also, remember the Part IVA general anti-avoidance rule: if your only reason for doing something is to get a tax benefit, it may be denied. Always have a commercial or legitimate purpose behind your actions.
Need Help with Your Tax Planning?
At Accountants 2 Business, we specialise in tax planning for Australian business owners. Whether you’re managing a trust, need help with super strategies, or just want peace of mind that your affairs are in order, we’re here to help.
📞 Contact us today to book your EOFY tax planning session.
📚 Related reading: See our Tax Guides
🌐 Learn more about our tax planning services: Tax Planning – Accountants 2 Business
