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The end of another financial year is looming and with that might come thoughts about your tax return and how your wealth has tracked throughout the year.

Whether you are nearing retirement, a high-income earner looking to reduce your taxable income, or you are on a lower income and looking for ways to maximise your super contributions, there are a few things you can consider at tax time.

Nearing retirement?

If you are nearing retirement, putting as much money into your superannuation account now is a good way to make sure you build up a healthy nest egg to live off in your golden years.

To maximise your super contributions, consider salary sacrificing to put more money into your super account.

Salary-sacrificed super payments take money out of your pre-tax income. These are called concessional contributions and are taxed at 15 percent. This rate is lower than most taxpayers’ marginal tax rates, so it can be an excellent way to reduce your taxable income while increasing your superannuation savings. 

The maximum employer and salary sacrificed contributions that can be made each financial year is $25,000. And remember, if you are self-employed, your concessional contributions are a tax deduction.

Non-concessional contributions of up to $100,000 can also be made each financial year. These come from your after-tax income.

Consider a one-off contribution

Let’s say you are on an income of $170,000. If you have not opted to salary sacrifice, your employer contributions to super will be $14,748.86 in the financial year. Therefore, your taxable income will be $155,251.14. 

To lower your taxable income, you could make a one-off concessional contribution of $10,000. This will reduce your taxable income and still come in under the concessional contribution cap of $25,000.

Are you eligible? 

If you earn less than $54,837 a year, in the 2020-21 financial year, before tax, you could be eligible for the government’s co-contribution on after-tax super contributions. 

Those who earn under the threshold can make an after-tax contribution and the government will calculate your co-contribution amount when you submit your tax return. 

The co-contribution will be deposited directly to your superannuation account.

Review your records now

Now is the time to check you have been keeping good records. Have you got a record of relevant receipts and policy statements for items such as income-protection policies you have outside superannuation?

Understanding the paperwork you require now to maximise your deductions will save you time when it comes to completing your tax return.

If you have not got all of your records organised, review your spending throughout the year, identify transactions that might be a tax deduction, and put aside those receipts for tax time.

Looking for more help?

If you’re looking to maximise your tax return and get ready for a successful financial year ahead, talk to a financial adviser about your options. It doesn’t matter your circumstances, there are options available to help you boost your super savings and get the best tax return possible.

• The information provided in this article is general in nature only and does not constitute personal financial advice.