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Tax management – getting your taxes in order

Tax management is important whether it has to do with business or personal finances. Keeping your files up to date is imperative to ensure you don’t get caught out. Failing to keep on top of your taxes can lead to hefty bills and worse!

1. Visit the ATO website

The Australian Tax Office website has a wealth of important information of which all business owners, and employees should be aware. If there are any questions about tax issues, then it should be the first port of call.

There are a number of different taxes to be aware of including income tax, superannuation tax, GST and FBT. 

2. Consider assistance with tax management

Of course, tax management can get complicated depending on different circumstances. Many people do not understand tax issues and as a result may be paying too much tax. If you require assistance with tax issues, consider employing the services of an independent financial adviser or accountant.

Peter Switzer says a great accountant can analyse your full circumstances and create a tax reduction plan.

“In many cases what they will find and recommend will save you more money than you fork out in the first year,” says Peter Switzer, founder of Switzer Financial Services. “Over time the savings will be massive, especially if they are invested wisely. This advice is more relevant if you have a more complex income and expense life but if you're a pay as you go employee, it might be wise to try a tax agent, at least once, to see if their knowledge about tax can actually increase your tax refund. Knowledge is power and it can be great for your bottom line.”

Depending on the type of employment, there might be particular deductions that can be claimed in a tax return. For example, teachers, journalists, Australian Defence Force members and so on may be able to claim certain employment-related items.

Switzer also says there are other benefits to getting advice.

“Tax advice is actually tax deductible in itself which means the Government makes legal tax reduction more affordable,” he says. 

3. Be honest with the tax office

David Pring from Deloitte Private explains that it is important for taxpayers to be aware of their tax affairs. “The Tax Office really does take dim a view of people who either don’t lodge returns or lodge returns late – things that are within the taxpayer’s control.”

Pring also warns it is important to be open with the Tax Office making sure that you provide full and frank information.

“The Tax Office takes their job very seriously,” he says.

4. Homework is key

Ensure you do your research. Read up as much as you can on tax and visit the tax office website to make sure you have all your bases covered. This is crucial when it comes to effective tax management. 

For advice you can trust book a complimentary first appointment with Switzer Financial Services today.

Important information: This content has been prepared without taking account of the objectives, financial situation or needs of any particular individual. It does not constitute formal advice. For this reason, any individual should, before acting, consider the appropriateness of the information, having regard to the individual’s objectives, financial situation and needs and, if necessary, seek appropriate professional advice.

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Published on: Thursday, February 03, 2011

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