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2025
End of Financial Year

In Brief 

30 June 2024​

  • $20,000 small business energy boost ended.

  •  Skills & training boost ended.

1 July 2024​

  • Personal income tax rates and threshold changed.

  • Super guarantee rate increased to 11.5%.

  • Small business instant asset write off for depreciating assets costing less than $20,000 extended until 30 June 2025.

21 May 2025

  • FBT return and payments due if applicable unless lodging electronically through a tax agent

25 June 2025

  • FBT return and payments due if lodging electronically through a tax agent.

Pre-30 June 2025

  • Review shareholder loan accounts and make minimum loan repayments (may need to declare dividends).

  • Pay superannuation to deduct contributions in the current financial year

  • Complete a stocktake where required (see Do you need to do a
    stocktake?).

  • Write-off bad debts and scrap any obsolete stock or plant and
    equipment.

  • Ensure any inter-entity management fees have been raised.

1 July 2025

  • Super guarantee rate increases to 12%.

  • GIC/SIC incurred no longer deductible.

14 July 2025

  • Single touch payroll finalisation declarations need to be made

  • (extensions can apply for closely held employees).

28 July 2025

  • Quarterly super guarantee payment due (1 April – 30 June).

28 August 2025

  • Taxable payments annual reports for payments to contractors due.

What's new

Superannuation Guarantee increases to 12%

The Superannuation Guarantee (SG) rate will continue with a final increase to increase to 12% on 1 July 2025. If your business is an employer, what this will mean depends on your employment agreements. If the employment agreement states the employee is paid on a ‘total remuneration’ basis (base plus SG and any other allowances), then their take home pay might be reduced by 0.5%. That is, a greater percentage of their total remuneration will be directed to their superannuation fund. For employees paid a rate plus superannuation, then their take home pay will remain the same and the 0.5% increase will be added to their SG payments.

ATO interest charges

From 1 July 2025, General Interest Charges (GIC) and Shortfall Interest Charges (SIC) will no longer be tax- deductible. This change will impact how interest on unpaid or underpaid tax liabilities is treated, and it is important for all taxpayers to carefully consider how this may affect their tax position. While GIC and SIC may accrue over time, for tax purposes, they are often treated as being incurred from a specific day, usually the day the relevant assessment is issued. This means the timing of assessments can be critical. For example, if a notice of assessment is issued before 1 July 2025, at least some of the associated GIC or SIC might still be deductible. On the other hand, if the assessment is issued on or after 1 July 2025, the entire amount could be non-deductible even if some of the interest accrued in an earlier period. Until now, all taxpayers have been entitled to claim a deduction for GIC and SIC under a specific provision in the tax legislation. This provision will be repealed and a new rule inserted to ensure that these charges are non-deductible from 1 July 2025. The ATO will still have discretion to remit GIC and SIC, but the treatment of any remitted interest will differ depending on when it was incurred: - If deductible GIC or SIC (i.e. incurred before 1 July 2025) is later remitted, it will be included in your assessable income. - If non-deductible GIC or SIC (i.e. incurred from 1 July 2025 onwards) is remitted, it will not be accessible. In situations where GIC is incurred daily such as on unpaid tax debts it is expected that only the interest accrued and incurred up to 30 June 2025 will remain deductible. GIC incurred from 1 July 2025 will be non-deductible, even if it continues to relate to older tax debts. We encourage you to review your current tax position and discuss any exposure to GIC or SIC with us ahead of 30 June 2025.

Instant write-off for depreciating assets

The instant asset write-off threshold is now $20,000 for the 2024-25 year. Businesses that have aggregated annual turnover of less than $10 million that use the simplified depreciation rules may be able to use the instant asset write-off rules to immediately deduct the business portion of the cost of eligible assets. Key things to remember include: - The full cost of the asset must be less than $20,000 after taking off GST credits that can be claimed. - To claim the deduction in the 2025 tax return the asset normally needs to be first used or installed ready for use for a taxable purpose between 1 July 2024 and 30 June 2025. - New and second-hand assets can qualify, subject to some specific exclusions and limits. - If you claimed an immediate deduction for an asset’s cost under the instant asset write-off rules in an earlier income year, you can also immediately deduct the first improvement cost for that asset if it is incurred between 1 July 2024 and 30 June 2025 and is less than $20,000. - The $20,000 limit applies on a per-asset basis, so you can instantly write off multiple assets as long as the cost of each asset is less than the limit.

Areas of ATO scrutiny

Contractor Payments

The ATO is paying attention to contractors who may not be reporting all of their income, especially in industries included in the Taxable Payments Reporting System (TPRS). These industries include building and construction, courier, cleaning, information technology (IT), road freight, and security, investigation or surveillance services. Businesses operating in these sectors are required to lodge a Taxable Payments Annual Report (TPAR), which outlines payments made to contractors. The ATO uses this information to match against income declared in contractors’ tax returns. In some cases, contractors might unintentionally understate their income. This can occur when pre-filled data from the ATO is not used. For example, a contractor such as a carpenter might miss including some income from clients who reported payments through TPAR. In such situations, the ATO may issue an amended assessment and penalties may apply depending on the circumstances. When a mismatch is identified, the ATO usually contacts the contractor or their tax professional to encourage them to review and, if needed, amend their tax return. If this is not addressed, the matter might progress to a compliance review or audit, and interest and penalties could be applied based on the nature of the discrepancy.

GST Reporting

Small businesses that have a history of non-compliance such as missing payments, late or non-lodgement of BASs and reporting incorrect GST are currently a key focus of the ATO. Starting from 1 April 2025, the ATO will notify certain small businesses with a history of non-compliance such as late payments, missed lodgements, or incorrect reporting that they are required to shift to monthly GST reporting. This measure is intended to support these businesses in meeting their tax obligations and establishing regular reporting habits. The monthly reporting cycle will remain in place for minimum of 12 months. A review process is also available for small businesses that do not believe they have a history of poor compliance and should be able to remain on their current GST reporting cycle. The ATO suggests that small businesses should consider voluntarily moving their GST reporting and payment cycle to monthly basis. Many businesses reporting monthly have found it easier to manage their cash flow and meet their obligations with smaller, more manageable payments that align better with small business reconciliation processes. Please let us know if you would like to explore this option.

Instant write-off for depreciating assets

The ATO has increased its focus on succession planning, especially for privately owned and wealthy groups. The ATO is focusing on private groups that incorrectly recognise the tax consequences of transactions or structures to minimise or avoid tax when undertaking succession planning. Situations that attract the ATO’s attention include: - Entities failing to recognise that a CGT event happened when they have restructured or transferred an asset - Entities incorrectly applying tax concessions or rollover relief - Entities adopting complex structures or entering into an arrangement to access tax concessions or rollovers that are not otherwise available - Entities failing to review the pre-CGT status of assets after an event that affects the beneficial ownership of such assets - Transferring wealth through loans, payments or forgiveness of debt and failing to consider the application of Division 7A - The use of trusts where there are amendments to the trust deed, such as changes to the trustee or appointor, adding or removing beneficiaries and amending the vesting date, and trusts have made family trust elections or interposed entity elections, and are distributing outside the family group - Entities inappropriately using self-managed super funds to access a lower rate of tax. Please let us know if you would like assistance with putting a succession plan in place or you would like us to review an existing succession plan. So many complex issues can arise in this area and prior planning can be crucial to determine potential tax risks before they are triggered.

Financial 'Housekeeping'

Having trouble with tax debt?

If you are having trouble paying your tax liability, please let us know as soon as possible so we can negotiate a deferral or payment plan with the ATO on your behalf.

Reporting payments to contractors

The taxable payments reporting system requires businesses in certain industries to report payments they make to contractors (individual and total for the year) to the ATO. ‘Payment’ means any form of consideration including non-cash benefits and constructive payments. Taxable payments reporting is required for: - Building and construction services - Cleaning services - Courier and road freight services - Information technology (IT) services - Security, investigation or surveillance services - Mixed services (providing one or more of the services listed above) The annual report is due by 28 August 2025.

Director ID regime

The director ID regime prevents the use of false and fraudulent director identities. While there was a transition phase to allow time for existing directors to obtain a director ID, this has now elapsed and all directors should have a director ID in place. Unregistered directors face criminal penalties of up to $16,500 and civil penalties of up to $ 1,375,000. All incoming directors are required to obtain a director ID prior to their appointment as a director.

Employee reporting
Single Touch Pay Role 

For payments to employees through single touch payroll (STP), a finalisation declaration generally needs to be made by 14 July 2025. However, there are some exceptions to this. If your business has 20 or more employees and some of them are closely held employees (relatives for example), then the finalisation declaration for the closely held employees needs to be made by 30 September. If your business has 19 or fewer employees and they are only closely held employees, the finalisation declaration should be made by the due date for lodgement of the tax return of the relevant employee. Employees will be able to access their Income Statement through their myGov account.

Closely Held Payees

Payments to closely held payees can be reported through STP in one of three ways: 1. Reporting actual payments in real time - reporting each payment to a closely held payee on or before each pay event (essentially using STP ‘as normal’). 2. Reporting actual payments quarterly - lodging a quarterly STP statement detailing these payments for the quarter, with the statement due when the activity statement is due. 3. Reporting a reasonable estimate quarterly - lodging a quarterly STP statement estimating reasonable year- to-date amounts paid to employees, with the statement due when the activity statement is due. Small employers that have arm’s length employees must report STP information on or before each payday regardless of the method that is chosen for reporting payments to closely held payees. If your business has closely held employees, it will be important to plan throughout the year to prevent problems occurring at year end.

Reportable Fringe Benefits

Where you have provided fringe benefits to your employees in excess of $2,000, you need to report the FBT grossed-up amount. This is referred to as a `Reportable Fringe Benefit Amount’ (RFBA).

Do you need to do a stocktake?

Businesses that buy and sell stock generally need to do a stocktake at the end of each financial year as the increase or decrease in the value of stock is included when calculating the taxable income of your business. If your business has an aggregated turnover below $50 million, you can use the simplified trading stock rules. Under these rules, you can choose not to conduct a stocktake for tax purposes if the difference in value between the opening value of your trading stock and a reasonable estimate of the closing value of trading stock at the end of the income year is less than $5,000. You will need to record how you determined the value of trading stock on hand. If you do need to complete a stocktake, you can choose one of three methods to value trading stock: - Cost price – all costs connected with the stock including freight, customs duty, and if manufacturing, labour and materials, plus a portion of fixed and variable factory overheads, etc. - Market selling value - the current value of the stock you sell in the normal course of business (but not at a reduced value when you are forced to sell it). - Replacement value - the price of a substantially similar replacement item in a normal market on the last day of the income year. A different basis can be chosen for each class of stock or for individual items within a particular class of stock. This provides an opportunity to minimise the trading stock adjustment at year-end. There is no need to use the same method every year; you can choose the most tax effective option each year. The most obvious example is where the stock can be valued below its purchase price because of market conditions or damage that has occurred to the stock. This should give rise to a deduction even though the loss has not yet been incurred.

  • 1. Declare dividends to pay any outstanding shareholder loan accounts
    If your company has advanced funds to a shareholder or related party, paid expenses or allowed a shareholder or other related party to use assets owned by the company, then this can be treated as a taxable dividend. The regulators expect that top-up tax (if any applies) should be paid by shareholders at their marginal tax rate once they have access to these profits. When it comes to loans, a complying loan agreement can normally be used to prevent the full loan balance from being treated as a taxable dividend. If you have any shareholder loan accounts from prior years that were placed under complying loan agreements, the minimum loan repayments need to be made by 30 June 2025. It may be necessary for the company to declare dividends before 30 June 2025 to make these loan repayments. The tax rules in this area can be extraordinarily complex and can lead to some very harsh tax outcomes. It is important to talk to us as soon as possible if you think your company has made payments or advanced funds to shareholders or related parties.
  • 2. Directors’ fees and employee bonuses
    Any expected directors’ fees and employee bonuses may be deductible for the 2024-25 financial year if you have ‘definitely committed’ to the payment of a quantified amount by 30 June 2025, even if the fee or bonus is paid to the employee or director after 30 June 2025. You would generally be definitely committed to the payment by year-end if the directors pass a properly authorised resolution to make the payment by year-end. The employer should also notify the employee of their entitlement to the payment or bonus before year-end. The accrued directors’ fees and bonuses need to be paid within a reasonable time period after year-end.
  • 3. Write-off bad debts
    To be a bad debt, you need to have brought the income to account as assessable income and given up all attempts to recover the debt. It needs to be written off your debtors’ ledger by 30 June. If you don’t maintain a debtors’ ledger, a director’s minute confirming the write-off is a good idea.
  • 4. Review your asset register and scrap any obsolete plant
    Check to see if obsolete plant and equipment is sitting on your depreciation schedule. Rather than depreciating a small amount each year, if the plant has become obsolete, scrap it and write it off before 30 June. Small business entities can choose to pool their assets and claim one deduction for each pool. This means you only have to do one calculation for the pool rather than for each asset.
  • 5. Bring forward repairs, consumables, trade gifts or donations
    To claim a deduction for the 2024-25 financial year, consider paying for any required repairs, replenishing consumable supplies, trade gifts or donations before 30 June.
  • 6. Pay June quarter employee super contributions now
    Pay June quarter super contributions this financial year if you want to claim a tax deduction in the current year. The next quarterly superannuation guarantee payment is due on 28 July 2025. However, some employers choose to make the payment early to bring forward the tax deduction instead of waiting another 12 months. Don’t forget yourself. Superannuation can be a great way to get tax relief and still build your personal wealth. Your personal or company sponsored contributions need to be received by the fund before 30 June to be deductible.
  • 7. Realise any capital losses and reduce gains
    Where management fees are charged between related entities, make sure that the charges have been raised by 30 June. Where management charges are made, make sure they are commercially reasonable and documentation is in place to support the transactions. If any transactions are undertaken with international related parties, then the transfer pricing rules need to be considered and the ATO’s documentation expectations will be much greater. This is an area under increased scrutiny.
  • Can I speak directly to the accountant if I need?
    At Addition Accounting we believe it is essential for our clients to be able to pick up the phone and chat to our team. When you first call you will chat with out administrator, Fiona and she will direct you where needed. We can be the integral resource that helps you meet your operational and strategic objectives with counsel tailored to your unique situation.
  • I have heard that some firms send the accounting work offshore, do you do this?
    At Addition Accounting, we understand how important it is for you and your business to feel heard and cared for by a local. Our team is located on the Sunshine Coast, with all accounting completed by by Katrina Moore-Porter who has been a qualified tax accountant of over 20 years. This enables us to really examine your business and look for ways to improve profitability, increase efficiency and make tax effective decisions.
  • I feel like I never know how my business is tracking financially is there an easy solution?
    At Addition accounting we take the hard work out of bookkeeping. We believe real time information at your finger tips is essential for a business to be a success. Call us today to talk about the many opportunities that are now available.
  • Can you help with my bookkeeping?
    Yes, we offer a full bookkeeping service that can be accessed any time anywhere. This means you log in and look at how your business is doing on your mobile, tablet and computer at any time. All work is quoted upfront so there are no hidden costs.
  • When is my BAS due?
    If you lodge your BAS on a quarterly basis then it is due on the 28th day of the following month e.g. for the September quarter it is due on the 28th of October. Monthly BAS is usually on the 21st day of the following month. The due date for lodging and paying is displayed on your business activity statement (BAS). If the due date is on a weekend or public holiday, you can lodge your form and pay on the next business day.
  • Do I have to register for GST?
    You must register for GST if: - your business or enterprise has a GST turnover (gross income minus GST) of $75 000 or more - your non-profit organisation has a GST turnover of $150 000 per year or more - you provide taxi or limousine travel for passengers in exchange for a fare as part of your business regardless of your GST turnover - this applies to both owner drivers and if you lease or rent a taxi. - You want to claim fuel tax credits for your business or enterprise. If your business or enterprise doesn’t fit into one of the above categories, registering for GST is optional. However, if you choose to register, you generally must stay registered for at least 12 months.
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