In doing so, investors will be able to get the maximum tax return for this financial year. With this, People’s Choice has outlined five factors that can help build your wealth.
1) The government
For part-time and casual workers, now is the perfect time to be looking into superannuation, according to People’s Choice senior financial planner Sally Kolbig.
“Part-time or casual workers can look to the federal government to help build their wealth,” said Ms Kolbig.
“If you earned less than $37,697 during the past financial year and make a $1,000 contribution into your superannuation fund, the government will add another $500 to your super. In fact, you can earn up to $52,697 and still receive some money from the government to lay the groundwork for a stronger investment,” continued Ms Kolbig.
2) Reap the rewards with super
Salary sacrificing can be an effective way to not only build your wealth but reduce the tax bill.
“If the total amount of compulsory employer superannuation contributions and any salary sacrifices to your superannuation fund are less than $25,000 for the year, you may be able to add a little extra and cut your tax,” said Ms Kolbig.
3) Take advantage of spousals income
If one spouse is on a low income, there are tax offsets that can be taken advantage of.
“If your spouse’s total income is less than $37,000, you can make a $3,000 contribution to their superannuation account and receive a $540 in tax offset,” Ms Kolbig said. “It’s a simple action that can make a difference in the final two weeks of the financial year.”
4) When losses become a gain
While investors rarely enjoy losing money during tax time, it can actually be an advantage. This is because investors can write off losses.
“Sometimes it may be better to accept the loss, and now is the time to make that decision. If you sell any loss-incurring assets such as shares in the coming weeks, you can offset those losses against your tax liability for gains on other assets you may have sold,” said Ms Kolbig.
5) Plan ahead and save
If you’re likely to have a larger bill in current financial year than the next financial year, it can be tactical to pre-plan expenses.
“If you have income protection insurance, consider paying next year’s premium before 30 June. You may get a kick out of ticking it off your to-do list, but you also get to claim a tax deduction on this year’s return,” Ms Kolbig said. “It’s a simple strategy that can yield some quick results.”