Your annual accounts are essential. They show you how the business performed, what you earned, and what you owe. That’s the compliance side, and it matters.
But it’s backwards-looking. By the time you see those numbers, the financial year is already over. The money has been spent. The decisions have been made. And if there’s a tax bill you weren’t expecting, it’s too late to do much about it.
Tax planning is the other half of the equation. It’s the forward-looking conversation that happens before the end of the financial year, while there’s still time to act. It’s not a replacement for good accounting. It’s the missing piece that makes the accounting more useful.
At Collins SBA, our advisory team works with hundreds of businesses across Tasmania. And every year, we see capable business owners who are doing well, making good decisions, and growing. But they’re caught off guard when the tax bill arrives. Not because they’re doing anything wrong. Because the forward-looking conversation never happened.
The surprise that shouldn’t be a surprise
“I just got hit with a massive tax bill, and I had no idea it was coming.”
We hear some version of this regularly. A strong year generates profit, but that profit gets reinvested. Debt repayments, equipment, drawings, personal expenses. The profit was real, but the cash is gone. And now there’s a tax bill that nobody planned for.
Tax planning changes that. We sit down with you before 30 June, review your year-to-date numbers, and estimate what’s ahead. You get time to prepare. You get a plan. And when the bill arrives, it’s expected.
It’s not just about the tax bill
Tax planning covers more ground than most people realise. When we sit down with a client for a tax planning session, we’re looking at:
Cash flow. Where has the money actually gone? Why does the bank account look different from the profit and loss statement? We help you see the full picture, not just the headline number.
Compliance deadlines. Trust distributions, dividend declarations, superannuation contributions. All of these have hard deadlines tied to 30 June. Miss them, and you can’t fix them after the fact. The ATO’s data matching technology means nothing slips through anymore.
Your business structure. The structure you set up when you started might no longer be the right one. Tax planning is the natural time to review it. If a change is needed, the cleanest time to make that transition is 1 July, the start of a fresh financial year with no split-year complications.
How you pay yourself. If you run a company, the way you draw money matters. Division 7A rules mean that personal withdrawals can create loan obligations with repayment and interest requirements. Getting this right before 30 June saves headaches later.
The bigger picture. For businesses with multiple entities, we consolidate the view. Your bookkeeper is focused on the day-to-day. We step back and look at how the group is performing as a whole, where the trends are heading, and whether anything needs to change.
Real results from real businesses
Every business is different, but the outcomes speak for themselves.
One of our clients was distributing income between three family members through a trust. After a strong year, all three were pushed into higher tax brackets. During a tax planning session, we identified additional eligible beneficiaries and restructured the distributions. The family’s effective tax rate dropped from roughly 35% to around 24%. Same income. Better structure.
Another client had sold their business and was facing a significant tax liability in a single year. Rather than extracting everything at once, we structured a staged approach over five years. A significant portion of the company tax already paid was recovered through franking credits. A painful one-year hit became a manageable, planned process.
These aren’t unusual outcomes. They’re what happens when you plan ahead instead of reacting after the fact.
When should you start?
The ideal time is at least 3 months before the end of the financial year. By then, we’ll have three quarters of actual financial data to work with, which means we can forecast the full year with confidence, and you’ll still have time to act on recommendations.
If you’re a Collins SBA client and haven’t discussed tax planning this year, take action now. Contact your advisor today to book a session before 30 June.
If you’re not yet a client, we’ve put together a free guide that covers everything we’ve discussed here in more detail, with case studies and practical advice. You can download it here.
Or simply give us a call on 1300 264 722. We’d genuinely welcome the conversation.
No technical language. No pressure. Just clarity, confidence, and control.
