The following tax tips are only guidelines. Here are some main points you need to consider, while not exhaustive, when you are preparing your income tax returns for the 2005/06 financial year:

For Individual Taxpayers

1. Keep written evidence to claim deductions exceeding $300. 
2. Car deductions - There are 4 methods in claiming car expenses. You need to make sure which method will give you maximum deduction. 
3. Superannuation contributions – The government will match the eligible personal contributions. There is couple of options available e.g. Super Co-contribution and superannuation contributions on behalf of your spouse. 
4. Consider making salary sacrificing contribution into super – can be highly tax-effective as the contributions are paid from your pre-tax dollars. 
5. Declare interest and dividend income – a lot of taxpayers get caught by not declaring the income. ATO can match the income with tax file number. 

For Business Taxpayers

1. Dividends and bonuses – pay any contemplated amounts prior to year end. 
2. Superannuation – Make sure all superannuation contributions are paid before June 30. Otherwise you will not be able to claim deduction in the financial year. 
3. Defer income – put off receiving income until after 30 June. That way you can delay paying tax for another year. Next year’s top marginal tax rate threshold for individual increases to $150,000. 
4. Bring forward deductions – pay for any necessary work expense now, rather than putting it off. 
5. Use tax-effective strategy using deductible superannuation contribution to max - increase net wealth position by reducing marginal tax rate of taxpayer. 
6. Stocktake – You will pay less tax if you have lower closing stock at end of year. Scrap any unsaleable stocks. 
7. Depreciation expense – review asset lists and scrap any obsolete and retired items. 
8. Bad debts – consider writing off any bad debts prior to year end. 
9. Use FBT and salary packaging – This could lead into tax savings for both employer and employee. 

For Investors & DIY Superannuation holders

1. Capital gains/losses – review the asset portfolio and consider realising any capital losses prior to year end to offset if you have capital gains. 
2. Minimise Capital Gains Tax - eligible for 50% CGT exemption if asset is held for more than 12 months. 
3. Split assets and income – place income and assets in the name of spouse with a lower marginal tax rate. But you must consider the costs of transferring existing assets – such as stamp duty and capital gains tax. 
4. DIY Super Audit – make sure you super fund is complying. Any significant breach can result in loss of tax concession. The assets and income of the fund will be taxed at 47%.