Individual Tax Planning Strategies

The following outlines common types of deductible expenses claimed by individual taxpayers, such as employees and rental property owners, plus some strategies that can be adopted to increase deductions for the 2016/17 income year.

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1. Depreciable plant, etc, costing $300 or less

Salary and wage earners and rental property owners will generally be entitled to an immediate deduction if certain income-producing assets costing $300 or less are purchased before 1 July 2017.

Some purchases you may consider include:

• books and trade journals;

• briefcases/luggage or suitcases;

• calculators, electronic organisers;

• electronic tablets;

• software;

• stationery; and

• tools of trade.

2. Clothing expenses

Purchase or pay for work-related clothing expenses prior to the end of the income year, such as:

• compulsory (or non-compulsory and registered) uniforms, and occupation specific and protective clothing;

• other expenses associated with such work-related clothing, such as dry cleaning, laundry and repair expenses.

3. Self education expenses

Consider prepaying the following self education items before the end of the income year:

• course fees (but not HECS-HELP fees), student union fees, and tutorial fees;

• interest on borrowings used to pay for any deductible self education expenses.

Also bring forward purchases of stationery and text books (i.e., those which are not required to be depreciated).

4. Other work-related expenses

Employees can prepay any of the following expenses prior to 1 July 2017:

• union fees;

• subscriptions to trade, professional or business associations;

• magazine and newspaper subscriptions;

• seminars and conferences;

• income protection insurance (excluding death and total/permanent disability).

Note: When prepaying any of the expenses above before 1 July 2017, ensure that any services being paid for are to be provided within a 12 month period that ends before 1 July 2018. Otherwise, the deductions must generally be claimed proportionately over the period of the prepayment.