Tax Saving Strategies for FY 2026

Welcome to the inaugural edition of our client newsletter series – Stay in the Loop, with WMA.

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There is Still Time to Reduce Your Tax before 30 June 2026!

As the end of the financial year approaches, now is the ideal time to review your tax position and take advantage of opportunities that may reduce your taxable income before 30 June 2026.

In this newsletter, we have compiled the following tax related matters to keep you in loop with common tax planning strategies.

We suggest that you take a deep dive into this newsletter, and reach out to our team, so we can review your current position and identify the strategies relevant for you, your family and your financial matters.

What makes up your Taxable Income?

Taxable income is all the gross income and taxable benefits earned throughout the financial year. The ATO counts below as common sources of assessable/taxable income:

• Employment Income: Salary, wages, bonuses, and commissions

• Investment Income: Interest from bank accounts, dividends from shares, distribution from managed funds, rent from investment properties

• Business & Trust Income: Net profit from running a business (as a sole trader, partnership distribution) and trust distributions

• Government & Insurance Payments: Certain taxable pensions, certain superannuation payments, allowances, insurance payouts (eg workers’ compensations or income protection payouts)

• Capital Gains: Net profit from sale of assets like property, shares, gold, silver or crypto

• Foreign Income: Income from foreign sources including foreign pension earned as an Australian resident

• Other Income: Freelance work, gig economy income, and contractor payments

Taxable income can be reduced by using effective tax planning strategies and avoiding some common mistakes with tax matters.

2025/26 Resident Individual Tax Rates

Australian resident tax rates for FY 2026 are as per below:

$0 – $18,200 - Nil

$18,201 – $45,000 - 16% of excess over $18,200

$45,001 – $135,000 - $4,288 + 30% of excess over $45,000

$135,001 – $190,000 - $31,288 + 37% of excess over $135,000

Over $190,000 - $51,638 + 45% of excess over $190,000

The Medicare Levy of 2% may apply in addition to the above rates.

Singles earning over $101,000 & families earning over $202,000 pay an additional Medicare Levy Surcharge (“MLS”) of 1% to 1.5%, if they do not hold adequate private hospital insurance cover for all family members.The family income threshold is increased by $1,500 for each MLS dependent child after first child.

The June 30 Tax Planning Checklist

Don’t leave these to the last minute:

• Check if you’ve reached your $30,000 concessional super cap and consider a top-up via personal deduction contribution

• Review your carry-forward unused super contributions caps (5-year lookback applicable to super balance under $500k as at 1 July 2025)

• Ensure super contributions are received by the fund atleast a week before 30 June 2026 (BPAY takes 2-3 business days)

• Submit Notice of Intent to Claim form to your super fund before lodging your FY 2026 tax return & provide us with an acknowledgement letter

• Prepay expenses for up to 12 months, if you are expecting high income in current year due to a milestone event (Eg. income protection insurance premium, interest on investment loan)

• Review any capital gains and losses - consider realising losses to offset gains

• Maintain a logbook for 12 weeks, if your car usage is high for work purposes

• Arrange for depreciation schedule prepared by a Qualified Quantity Surveyor for your rental property to maximise rental expenses claims

• Keep records of all deductions claimed

• Confirm if you have private hospital insurance cover in place if you are a single earning over $101,000 (families over $202,000)

• Prepare Trustee resolutions for any family trust distributions

Top Tax Saving Strategies for FY 2026

Below are some common tax planning strategies that may be available depending on your circumstances.

1. Maximise Superannuation Contributions

If eligible, taxable income can be reduced by making additional concessional super contributions using the following super caps,

• Annual Concessional Contributions Cap; and

• Carry Forward Unused Concessional Contributions Cap.

Additional concessional contributions can reduce taxable income; increase retirement savings; and provide valuable tax savings. Concessional contributions are taxed at 15% when received by the fund, as compared to marginal tax rates which can go up to 47%, resulting into substantial tax savings.

Annual Cap:

The annual concessional contribution cap for FY2026 is $30,000 per year (Note: annual cap increases to $32,500 for FY 2027).

You can maximise your annual concessional cap in the following ways:

• Employer’s super guarantee contributions (currently at 12%);

• Salary sacrifice contributions: You can arrange with your employer to pay your pre tax salary directly into super. Your tax savings will be equal to your marginal tax rate less 15% contributions tax paid by your super fund.

• Personal concessional contributions: You can contribute after tax money into super and claim a tax deduction in your tax return. You must lodge Notice of Intent to claim the tax deduction with your super fund, prior to claiming the deduction and receive an acknowledgement letter before lodging your tax return.

Carry forward Unused Concessional contributions Cap:

Individuals with a Total Superannuation Balance below $500,000 may also be eligible to utilise unused concessional contribution caps from prior years.

Important Note! This is a complex area and it is recommended to also seek advice from an independent financial planner to determine the available unused cap.

Division 293 tax applies to high income earners:

If your adjusted income plus concessional super contributions exceed $250,000, an additional 15% tax (total 30%) applies to super contributions. Even at 30% total tax payable by the super fund, this is well below the 47% marginal rate — so the strategy still works for high income earners.

Important Note! Once you make contributions to super, you cannot access the super fund balance until you retire. Moreover, if the cap is breached, it can result into excess concessional contributions tax & unnecessary administrative work & costs. Hence its best to also seek advice from an independent financial planner prior to making additional super contributions.

2. Claim All Eligible Work-Related Deductions

Ensure you have considered all allowable work-related expenses and have kept records to support them, including:

Motor vehicle expenses

• Log book method – For higher claims based on actual costs incurred, a 12 week log book must be maintained to establish work usage % for your vehicle. New log book is required every 5 years or if a new vehicle has been purchased.

• Cents per km method – Claim of 88 cents per km is available for up to 5,000 work related kms, if a log book has not been kept.

Home office expenses

• Fixed Rate Method – Allows for 70 cents per hour for FY 2026. This covers:

  • Electricity & Gas,

  • Mobile,

  • Internet and

  • Stationery costs.

  • Important Note! For FY 2026, the ATO still requires more detailed records in the form of diary to substantiate hours worked from home. This diary must be completed on a daily basis, as a sample is not sufficient.

• Actual Method – If home office usage is higher, actual method can be used, provided proper records have been kept to claim home office expenses. We will require actual copies of electriciy and gas bills.

Self education expenses – If eligibility criteria is met, deductions can include:

• Course fees

• Textbooks

• Study materials

• Travel costs

• Motor vehicle expenses (A diary is required to be maintained for atleast 1 month if you would like to use cents per km method)

Tools and equipment

• Items under $300 can be claimed in full.

• Items over $300 can be depreciated over the life of the assets.

Other Deductions to be considered:

• Uniform/Protective Wear

• Laundry for work related uniform (up to $150 per year without receipts. If using coin laundry keep receipts/records if spending more than $150. I receipts are not available, an expense diary must be maintained)

• Work related mobile and internet usage

• Union fees and professional memberships

• Donations over $2 to deductible gift recipient (DGR) status charities (Keep receipts)

• Tax agent fees (paid for prior year’s return and any tax advice)

Keep appropriate records and receipts to substantiate claims for atleast 5 years.

3. Review Salary Packaging Opportunities

With salary packaging arrangements, you agree to receive less pre-tax income in exchange for your employer paying for certain benefits. This can help to reduce taxable income. Examples include:

• Additional superannuation contributions

• Novated vehicle leases

• Home loan repayments

• Laptops, portable devices

Charity and public hospital employees can access salary packaging of up to $15,900 of living expenses paid tax-free, including rent, mortgage payment, child care fees, etc. The tax free cap (maximum amount you are allowed to package tax free) for not for profit organisations is $15,900 and $9,010 for hospital and healthcare employees.

Important Note! Please seek advice regarding the tax implications of any salary packaging arrangement.

• Not all employers offer salary packaging arrangements.

• Fringe Benefit Tax (FBT) applies to many benefits, some benefits used primarily for work are FBT exempt.

• Tax savings is dependent on your marginal tax rate and whether the benefit attracts FBT.

• Salary packaging may impact your borrowing power, as some lenders assess packaged salary and not gross salary.

4. Prepay Deductible Expenses

ATO allows prepayment of expenses of up to 12 months to be immediately deductible. You can bring forward deductions of expenses in FY 2026 by prepaying the following common tax deductible expenses:

• Income protection insurance;

• Professional subscriptions & memberships;

• Investment property loan interest (prepaying 12 months of interest before 30 June;

• Property management fees & landlord insurance.

This strategy works best if your current year income is higher than your income in next year. Prepaying in high income year allows to maximise the deductions value.

Important Note! Only 12 months prepayments are immediately deductible. Any excess over 12 months gets carried forward to following year.

5. Get Private Health Insurance to avoid Medicare Levy surcharge

For FY 2025-2026 Singles earning over $101,000 (families over $202,000), who do not hold appropriate private hospital cover may be liable for the Medicare Levy Surcharge (MLS) of up to 1.5% of taxable income on top of the standard Medicare Levy.

Important Note! 2026-2027, the MLS base tier threshold is $105,000 for singles and $210,000 for families.

Review your level of cover before 30 June 2026 to determine whether additional tax may apply.

6. Review Rental Property Deductions

Rental property owners should ensure all available deductions are claimed, including:

• Interest on property investment loans

• Council rates, body corporate rates, land tax and water rates

• Building and landlord insurance premiums

• Property management fees

• Repairs and maintenance

• Gardening

• Depreciation on plant and equipment (Keep invoices)

• Depreciation on building structure (2.5% per year, arrange depreciation report prepared by a Qualified Quantity Surveyor). A depreciation schedule may identify additional deductions that are often overlooked.

Important Note! We have partnered with a team of Quantity Surveyors, who have agreed to offer their valuable services to our entire client base at discounted rates, for preparation of the following reports for properties owned under various structures (including Trusts, SMSFs, Deceased estates, Family Law Court matters):

• Depreciation reports for newly purchased property

• Depreciaiton reports for existing property

• Market appraisal report for your property

• Rental appraisal report for your property

Should you require any assistance with preparation of the above mentioned reports, please reach out to our team, and we can connect you with our preferred network.

7. Consider Capital Gains Tax Planning

Before selling investments, consider:

• 50% CGT discount

• Use of available capital losses

• Timing of the disposal of the asset (consider selling an asset in the year with lower income)

Strategic planning can reduce tax payable on capital gains.

Important Note! ATO uses contract date and not the settlement date to determine when a CGT event occurs. Signing a contract in last week of June compared to first week of July, can shift significant capital gains tax liability to following financial year.

8. Claim the Cost of Managing Your Tax Affairs

You are entitled to maximise your deductions for:

Tax planning advice

Tax agent fees

Software subscriptions

Accountant fees & Bookkeeping fees

Certain costs associated with managing your tax affairs

Interest on loans taken to pay business related tax liabilities

9. Timing Income across Financial Years

Self employed individuals and business owners can influence when the income is recognised.

If you are expecting lower income next year, income can be shifted to following year by:

• Delaying invoicing until after 30 June

• Deferring bonus to July

• Timing contract completion

• Bringing forward deductible expenses to current year

10. Optimising Business Structure

Carefully planning your tax structure can help to reduce tax payable for your family group.

Sole Trader - Personal marginal tax rates (up to 47%)

Company (base rate entity) - 25%

Company (investment entity) - 30%

Discretionary Trust (100% profit distributed) - 0%, also depends on beneficiary type

Discretionary Trust (100% profit retained) - 47%

SMSF (100% accumulation phase) - 15%

SMSF (100% pension phase) - 0%

What Mistakes to Avoid?

• Overclaiming expenses without records

• Missing super payment deadline of 30 June 2026

• Not arranging Notice of Intent and Acknowledgement letter for super contribution made by the due date, thereby missing out on deduction

• Overlooking impact of Division 293 tax for high income earners

• Setting up tax structures first, prior to purchase of asset

• Ignoring implication of HECS repayment on tax return, when setting up salary sacrifice arrangements.

• Prepaying expenses for more than 12 months

Most importantly, not consulting with your accountant prior to your financial milestone, is one of the most common mistakes we have come across. Once the legal and financial structure is locked in, our ability to minimize your tax liability is severely limited.

Some common scenarios that require pre planning & your accountant’s involvement include:

• Business Expansion or Hiring Staff

• Real estate transactions, including buying your new home, buying an investment property, selling an investment property

• Retirement Planning & superannuation

• Restructuring or selling your business including transitioning from a sole trader to a company or preparing to sell your business

• Major asset purchases including deciding whether to finance, lease or buy outright

• Mortgage restructure including borrowing

• Succession planning for your business

• Preparing your estate plan including wills with your lawyer

• Critical illness or Death of a family member

2025/26 Tax Return Checklist - Individuals

We will need you to bring information to assist us in preparing your income tax return. Whilst we may be able to access data already held by the ATO, please check the following and bring along any information available to you, or a summary thereof, to help us prepare and complete the return.

Income/Receipts

• Details for salary and wages;

• Lump sum and termination payments;

• Government pensions and allowances;

• Other pensions and/or annuities;

• Allowances (e.g., entertainment, car, tools);

• Interest, rent and dividends;

• Insurance proceeds, particularly relating to claims in relation to workplace activity (not all payouts are assessable);

• Distributions from partnerships or trusts;

• Details of the sale of any assets that were either used for income earning purposes or which may be subject to capital gains tax (CGT) e.g. shares/real property

• Other income e.g. Foreign income

Expenses/Deductions (in addition to those mentioned above)

• Bank charges on income earning accounts (e.g. Term Deposits);

• Road tolls (if travelling on work);

• Car parking (when travelling on business);

• Conventions, conferences and seminars;

• Depreciation of library, tools, business equipment, (incl. portion of home computer);

• Gifts or donations;

• Home office running expenses:

  • cleaning;

  • electricity and gas bills;

  • depreciation of office furniture;

  • the number of hours that you worked from home;

  • telephone and internet bills;

• Interest on loans to purchase equipment or income-earning investments;

• Motor vehicle expenses (business/work related);

• Overtime meal allowances - (evidenced by either receipt, or written record)

• Sun protection items (if work related);

• Tax agent fees;

• Telephone expenses (business);

• Tools of trade;

• Personal superannuation contributions (including acknowledgement letter from the super fund);

• Tax audit insurance

• Travel allowance expenses

Investments (not bank transaction accounts)

Interest and dividend deductions

• Account keeping fees

• Ongoing management fees

• Interest on borrowings to acquire investments

• Advice relating to changing investments (but not setting them up)

Rental Property Income and Expenses

• Purchase contract & settlement statement if purchased during the year

• Agent statement (if not rented privately)

• Advertising expenses

• Council rates

• Water rates

• Body Corporate Fees

• Depreciation on fixtures & fittings (if purchased separately to the dwelling)

• Insurance

• Interest

• Land tax

• Legal expenses/management fees

• Genuine Repairs and maintenance

• Other expenses necessarily incurred

• Depreciation report prepared by a qualified Quantity Surveyor.

Sale of Investment Assets

If you sold assets during the year, you may be liable for capital gains tax. This includes, sale of property, sale of shares or sale of cryptocurrency. If a sale of assets has occurred please let this office know so we can assist you in the completion of your return affected by this accordingly.

Documents required in relation to sale of a property:

• Contract of Sale

• Settlement Statemetn from Pexa

• Invoice from Real Estae Agent for commission paid

• Invoice from conveyancer on legal fees paid

• Invoices for any other expenses incurred in relation to sale

• Purchase related documents to determine purchase price:

  • Contract of sale

  • Settlement statement

  • Invoices from conveyancer or legal fees paid

  • Depreciation Schedule

Sale of Main Residence

CGT does not apply to the sale of your main residence unless the property has not always been held as your main residence. You will still need to let our team know if you have sold your main residence, so that a declaration can be submitted with your income tax return.

Cryptocurrency

A capital gains tax {CGT) event occurs when you dispose of your cryptocurrency. A disposal can occur when you:

• Sell or gift cryptocurrency;

• Trade or exchange cryptocurrency (including the disposal of one cryptocurrency for another cryptocurrency);

• Convert cryptocurrency to fiat currency (a currency established by government regulation or law), such as Australian dollars, or

• Use cryptocurrency to obtain goods or services.

If you make a capital gain on the disposal of cryptocurrency, some or all of the gain may be taxed.Certain capital gains or losses from disposing of a cryptocurrency that is a personal use asset are disregarded.If the disposal is part of a business you carry on, the profits you make on disposal will be assessable as ordinary income and not as a capital gain.

While a digital wallet can contain different types of cryptocurrencies, each cryptocurrency is a separate CGT asset. Contrary to myth, the Australian Taxation Office receives reports directly from the various exchanges. It is appropriate to voluntarily declare trading activity to ensure that you do not incur non-disclosure penalties and ATO interest charges.

Information required:

• Tax Reports from digital platforms showing capital gains tax reports

Important Dates!

Ensure you have lodged your FY 2025 tax return. Get in touch with us if your tax return is still outstanding.

12 June 2026 Extended due date for tax returns for FY 2025

21 June 2026 Lodge and Pay May 2026 Monthly BAS

25 June 2026 Lodge and Pay FY 2026 Annual FBT Return

30 June 2026 End of Financial Year, make super contributions prior to this date Prepare and Execute Trust Distribution Minutes

01 July 2026 Tax Return Season Opens

31 Oct 2026 Due date for self-lodged individual tax returns (No tax agent)

15 May 2027 Due date for tax return for FY 2026 (Lodged through tax agent portal)

Next Steps

The strategies above are general in nature and will work for your depending on your circumstances (your income source, your current family situation, your asset portfolio, your retirement goals, and other personal goals). What works for you may not work for others and vice versa. Hence its very important to take a tailored approach with tax planning strategies rather than a generic advice approach.

The team at Whitson Medcraft & Associates works with business owners, investors, sole traders, employees and retirees to build an effect tax planning strategy tailored to their circumstances.

If you require any assistance with tax matters, we are only a phone call away. Contact our office to book an appointment.

Disclaimer: The information provided in this newsletter is general in nature and does not constitute specific tax or financial advice. It has been prepared without taking into account your specific objectives, financial situation, or needs. We recommend you seek professional advice from a qualified tax agent before making any decisions based on this information.

Source: NTAA and ATO