The $3.0m Super tax is coming back – what do we know?

Budgeting is an important part of business planning. A well-designed budget helps leaders manage finances, allocate resources and stay on track to achieve business goals. Here are 6 practical tips to help create a budget that works for your business. 1. Set Clear Goals Define financial goals for the upcoming period. Whether it's increasing revenue, reducing costs, or expanding operations, clear objectives guide all budgeting decisions. For example, a business aiming to increase sales by 15% in the next year, might budget for targeted online advertisements and promotions which drive traffic to the website. The budget would be quite different for a business aiming to cut costs by 5% in the coming 6 months. 2. Track Income and Expenses Detailed records of the business's income and expenses help identify spending patterns and cost cutting opportunities which are taken into account in the next budget cycle. These records help leaders analyse and identify patterns in revenue and expenses to develop intelligent assumptions on what may happen in the future. 3. Be Realistic (Even Conservative) When creating the budget, be realistic about revenue projections and expense estimates. Overestimating income or underestimating expenses can lead to budget shortfalls and financial difficulties. It can also be helpful to make budgets with different scenarios based on, for example, ‘aggressive’, ‘conservative’ and ‘expected’ assumptions. In any case, always err on the conservative side. 4. Prioritise Essential Expenses Identify the business's essential expenses, such as rent, utilities, and payroll, and prioritise them in the budget. This ensures they’ll be covered even if revenue is lower than expected. For example, we’d expect a manufacturing company to prioritise essential expenses such as raw materials and production costs over the website upgrade, company offsite and internal newsletter. 5. Plan for Contingencies Include a contingency fund in the budget to cover unexpected expenses or revenue shortfalls. Having a buffer avoids financial difficulties if things don’t go as planned. For example, a contingency fund can help a services business deal with a sudden increase in project scope, so they can hire additional staff to deliver the project on time. 6. Review and Adjust Regularly Review the budget regularly and adjust as needed. As the business grows and market conditions change, the budget should evolve to reflect these changes. Most well-run businesses will review the budget at least monthly. A budget helps leaders commit to certain forecasts and optimise business performance as things change. We suggest you follow these guidelines when preparing your next budget!

Most of us have work-related expenses, and knowing exactly what you can claim can make a noticeable difference to your refund. Travel & vehicle expenses: beyond the daily commute If you use your own car for work, say driving between job sites or to client meetings, you may be able to claim travel expenses . Just keep in mind that your daily commute from home to work isn’t deductible. There are two ways to claim: Cents per kilometre: claim 88 cents per km (2024–25) for up to 5,000 work-related kilometres. This includes fuel, maintenance and depreciation. Just document how you calculated the distance. Logbook method : for claims over 5,000 km or actual costs, keep a 12-week logbook to track business use. You can then claim a portion of car expenses like fuel, rego, insurance, and repairs. Working from home: rules for claiming home office deductions With more Aussies working from home, claiming home office expenses has become standard. Since March 2023, the ATO requires you to keep a record of your actual work-from-home hours, your calendar or timesheet will do! There are two ways to claim: Fixed rate method (70c/hour) : covers energy costs, internet, mobile phone use, stationery, and computer consumables. You can’t claim these separately. Actual cost method : claim a work-related portion of your additional expenses if you have detailed records. You can also claim depreciation on big-ticket office expenses like a desk or monitor (even if using the fixed rate method). Just note: rent, mortgage interest or council rates usually aren’t deductible if you’re an employee. Uniforms, protective gear & laundry: dressing for success Wearing a compulsory uniform with a logo, occupation-specific clothing (like scrubs or chef whites), or protective gear (like high-vis or steel-capped boots)? You can claim the cost to buy and clean them , including dry cleaning. Everyday clothes, even if only worn for work, aren’t deductible. Tools and equipment: big vs small This covers everything from your laptop to a tradie’s toolbox. The rule of thumb: Under $300 : Claim the full cost in the year you buy it, great for items like keyboards, headsets, or work bags. Over $300 : Claim depreciation over its effective life, based on how much you use it for work. This applies to bigger purchases like laptops or tools. Check the ATO’s depreciation and capital allowances tool . Self-education: investing in your career Courses that directly relate to your current income-earning job can be deductible , think a designer doing an advanced Adobe course. Astronomy while working in retail? Probably not. Eligible deductions include: course fees (excluding HECS/HELP) textbooks and stationery internet and phone usage depreciation on computer equipment. Mobile phone & internet: the work/life divide Using your personal phone or home internet for work? You can only claim the portion you use for work. So, if 50% of your internet usage is work-related , you can claim 50% of the cost. Keep a logbook or a diary for a typical month to estimate your work percentage. Overlooked opportunities: don’t miss these tax deductions! Beyond the common work-related expenses, there are other deductions that often get missed: Tax agent fees : yep, the fees you pay to a registered tax agent to prepare your previous year’s tax return are deductible. Investment property expenses: If you own a rental, you can claim certain expenses to reduce your taxable income. They fall into three categories: claim now: loan interest, council rates, repairs, insurance, and management fees claim over time: capital works, borrowing costs, and assets over $300 (via depreciation) not claimable: personal expenses, travel expenses or second-hand assets bought after May 2017. Some pre-rental expenses, like loan interest, may be claimable if your intent was to rent the property. Union fees, membership fees ®gistrations : any fees paid to a professional association or trade union are claimable. Income protection insurance : if you pay premiums for income protection insurance that covers lost income (not life or trauma insurance), you can claim them. Just not if your super fund pays for it. Cost of managing tax affairs : this includes things like tax preparation software or even travel costs to see your tax agent. Gifts & charitable donations : if you’ve donated $2 or more to a registered charity (a Deductible Gift Recipient or DGR), make sure you claim it and have your receipt.  Work Hard, Claim Smart Knowing what work-related expenses, you can claim helps you get back more at tax time. Whether it’s driving between job sites, using your home internet for work, or buying tools or uniforms, every deductible expense adds up. Just remember, you need to keep good records and make sure the expenses are directly related to earning your income. With the right approach, you can claim what you're entitled to and avoid missing out on valuable deductions.

The Australian Government has announced significant changes to the Higher Education Loan Program (HELP), including HECS-HELP loans, aimed at reducing the financial burden on university graduates. These reforms, effective from the 2025 financial year, are set to benefit approximately three million Australians. 20% Reduction in Help Debt From June 1 2025 all outstanding HELP debts – including HECS-HELP, FEE-HELP, SA-HEPL, OS-HELP and Vet student loans will be reduced by 20% before any indexation is applied. This measure is expected to alleviate approximately $16 Billion in student debt across the country. The Australian Tax Office will automatically apply this reduction to eligible accounts. https://www.education.gov.au/higher-education-loan-program/20-reduction-student-loan-debt/faqs-20-reduction-all-outstanding-help-loan-debt?utm_source=chatgpt.com Change to Repayment Thresholds Effective July 1 2025 the minimum income threshold for compulsory HELP repayments will increase form $54,435 to $67,000. Additionally, a marginal repayments system will be introduced, where repayments are calculated only on income above the new threshold, rather than on total income. This adjustment means that graduates earning below this new threshold will not be required to make compulsory repayments, and those earning above it will pay a smaller percentage of their income towards their debt. These reforms are part of the government broader effort to make higher education more accessible and to support graduates in their financial journey’s.

Am I in business? This might seem like a strange question, but for some taxpayers it is very important to consider as income generated from a hobby is generally not taxable income and all expenses incurred are not deductible as a result. We’ve had lots of questions about this in the past from people who may be running a stall at local markets selling hand made goods, or creating digital content and receiving remuneration and goods as a part of this. Sometimes it can be hard to tell if this income is derived in pursuing a hobby or operating a business, but there are some important determinations set out by the ATO to consider. The entire scope must be considered in relation to the below, not just one point, for example if an activity is completed ad hoc with no business plan, but the activity is completed with profit making intentions this is likely to be deemed as a business. Essentially, the intention, regularity and purpose of the activity can help to identify whether it is a hobby or a business, the most important thing to consider is what is the purpose of the activity. If you are just completing an activity solely for enjoyment and recuperating input costs by selling to family and friends, this could just be a hobby. But this can get very difficult to determine when getting into the nitty-gritty details, so if you are needing any help in determining whether your activity is a hobby or a business, please contact our office to discuss this further.