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Tax Planning Process

What is Tax Planning?

Tax Planning is not the same as tax compliance. With tax compliance your accountant tries to maximise your refund or savings by claiming valid deductions that you have evidence for. Tax planning however is an advanced service that investigates what legal strategies you could implement to make structured savings and the required action/steps that are necessary to make those tax savings happen. 

This can produce very significant savings in the range of $2,700 - $100,000 pa. Well beyond anything that can be achieved by only lodging a tax return.

Who Can Benefit From Tax Planning?

It's simple - All taxpayers can benefit from tax planning and the savings that are created. Our research shows that 95% of taxpayers can legally reduce the amount of tax they pay.

Approximately 50% of Australian taxpayers use legal tax planning strategies to minimise their tax with the most popular strategies being negative gearing of residential properties (2.1 million taxpayers), and salary sacrificing super contributions (4 million taxpayers).

See our blog post on Australia's most expensive legal tax breaks

See Money Smart - Contributing Extra to Super

4 Step Tax Planning Process

  1. Information gathering – For effective tax planning essential client information is collected:

    The group members (i.e. all the individuals and entities that make up the client’s overall structure),
    Group members’ current year income and expenses, 
    Group members’ assets and liabilities.

  2. Selecting tax strategies - This is a two-part process. Firstly, your unique circumstances (identified through step 1) are considered in conjunction with the unique attributes of each available tax strategy. We use a tax strategies database with over 250 strategies. Then secondly, we use tax planning software and our expertise to select up to 10 optimal tax strategies for you.

  3. Tax savings report – Special tax planning software is then used to produce a report that details the tax savings generated from implementing the selected tax strategies, and the step-by-step process to legally and effectively implement each strategy (including the cost).

  4. Client discussion and implementation – We then discuss the tax savings report and implementation process with you so you fully understand the options. We can then also implement the strategies for you if you choose to proceed.

Achievable Tax Savings

The table below is a guide to the savings that are possible if 10%, 25%, 50%, or 100% savings are achieved.

tax savings

See case studies of tax planners saving clients' tax using the tax savings report.