3 cheap and easy ways to lower your tax bill

Note: this article excludes property, because most people would not consider it to be cheap or easy.

1. run a business

I don’t mean that you necessarily need to quit your job or go out and buy an expensive business. It can be something small and part time, like driving Uber (no offence to any full time Uberists) or something like a Network Marketing business with an low entry cost. You don’t need to make millions, but here’s a link to the Business Expenses section on the ATO website. You’ll likely need to create an ABN and do the whole sole trader thing, but you should check that out with your accountant to make sure that this advice is a good fit for your circumstances.

2. salary sacrifice into your superannuation

You will need to speak to your superannuation fund about this, as different funds have different methods of contributing. If your employer knows more about your super than you do, get as many details from them as you can. Salary sacrifice arrangements mean that you reduce your pre-tax income and then are able to stick you into a lower tax bracket. Please be sure to do the tax calculations using the ATO tax calculators first, because you don’t want to disadvantage yourself.

3. salary packaging 

Many employers allow you to package your salary, which is similar to salary sacrificing except you can get different things from it, not just superannuation contributions. Depending on your employer and the salary packaging provider, you might be able to ‘package’ cars, computers, holiday accommodation and many other things. It works by ‘packaging’ some of your pre-tax income away, so you get taxed on less dollars.

So there you have it folks, always be sure to speak to your accountant about these strategies first to make sure you are getting the right advice for your circumstances.

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