Superannuation – individuals

Individuals are able to claim a tax deduction for personal superannuation contributions up to your $30,000 cap for the 2025 financial year (which includes contributions from your employer). There are also other eligibility criteria you must meet.

Don’t forget that carry-forward unused concessional contributions may also available if you haven’t used your full cap for the 2020, 2021, 2022, 2023 and 2024 financial years. This is the last year that any unused cap amount for 2020 can be utilised. If this is something you would like to utilise, please let us know and we can assess your eligibility and calculate how much can be utilised from prior years.

Should you plan to make a personal contribution to your superannuation account before the end of the 2025 financial year, make sure to check your fund’s cut off dates and payment reference number relevant for personal contributions (eg. BPay). Most retail funds require you to make your contribution by the second or third week of June to ensure it is received and allocated to your account by 30 June 2025.

A reminder that in order to claim a deduction for these super contributions, you must give your super fund a notice of intent to claim a tax deduction form and get an acknowledgement letter from the fund.  The Notice of Intent to claim a tax deduction will usually be sent by a retail fund in July and can be completed and lodged at any time prior to your income tax return being finalised.  You must receive an acknowledgement letter from the fund prior to lodgement of the income tax return.

Individuals are also able to make after-tax contributions (i.e. no tax deduction claimed) within annual, 3 year and total superannuation balance caps to assist in long-term tax minimisation.  Please contact your Holman Hodge advisor for further information as a personal assessment of your situation is important and the caps are changing from 1 July 2025.

Superannuation – businesses

Superannuation is deductible when paid. If you pay the June quarter super prior to 30 June (rather than waiting until the due date of 28 July), you are able to claim this as a tax deduction in the 2025 financial year.

If you would like to claim a deduction for these super payments, it is important to confirm with your software/clearing house provider what the relevant cut-off dates are for payments to be received by the super funds by 30 June.

Can we give you a hand?

If you would like any further detail on the above, or for an estimate of your tax position for the 2025 financial year, please contact your Holman Hodge advisor.

As we approach the end of the financial year it’s a good time to start thinking about what you could do to minimise your tax liability.

Discretionary trusts

• Trust minutes/resolutions: Trustees of discretionary trusts have to resolve where they would like to distribute their income for the 2025 financial year prior to 30 June 2025. We will discuss distribution strategies with the trustees and assist with the documentation of these ahead of 30 June.
• Careful consideration needs to be had with regards to trust distributions across family groups. The ATO has provided guidance which details their position with regards to this and where it impacts your group, we will discuss this with you in your year end tax planning meeting. Alternatively you can contact us directly to discuss.

Tax Planning Tips & Information

• The company tax rate for base rate entity companies remains at 25%.
• If you are a small business (aggregated turnover less than $10 million) you can claim an immediate deduction for assets purchased under $20,000, provided the asset is ready for use by 30 June 2025.
• Superannuation: Individuals should consider whether superannuation contributions should be made up to the concession cap ($30,000 for 2025).  Don’t forget that carry-forward unused concessional contributions are available which allow individuals to claim an additional tax deduction if a superannuation contribution is made to use up unused concessional contributions from the 2020, 2021, 2022, 2023, 2024 financial years. Please note, to claim a personal superannuation contribution, a notice of intent must be lodged with the superannuation fund. This is the last year that any unused cap amount for 2020 can be utilised. There are also other eligibility criteria you must meet.
• Capital Gains Tax: If you have made a capital gain during the 2025 financial year, you may consider realising a capital loss (if appropriate) on another asset to offset the capital gain.
• Cash flow: Vary PAYG instalments for the June 2025 quarter (if appropriate). This is best done in conjunction with an estimate of your 2025 tax position.
• Working from home deductions: You can use the Fixed Rate method and claim 70 cents per hour for the 2025 financial year where you worked from home. Make sure you have detailed records that record the total number of hours you work from home and the expense you incur while working from home. You can also use the actual cost method.
• Ensure that you retain receipts or substantiation for any expenses you would like to claim such as those related to your work, self-education, travel and donations.
• If you travel over 5,000kms in your motor vehicle for work, consider whether you should maintain a log book or whether you need to complete a new one (to be completed every five years). If you are relying on a log book prepared from a previous year you also need to record the odometer reading as at 30 June.
• Trading stock: Conduct a stocktake at 30 June, write off any obsolete or damaged stock and choose your stock valuation method. You can use cost, market selling value or replacement value, for each item, and this can be changed each year. If you are a small business entity and your trading stock value has not moved by more than $5,000 you do not have to do a stocktake.
• Superannuation (businesses): Pay your super before 30 June in order to get a tax deduction for the 2025 financial year. Super contributions need to have been received by the superannuation fund by 30 June – confirm with your software/clearing house provider if there are any cut-off dates to ensure this occurs. Also note that from 1 July 2025 the Superannuation Guarantee (SG) rate will rise from 11.5% to 12%. Before this date, ensure you update your accounting and payroll systems, review and adjust your wage budgets and inform your team of any changes.
• Accrued expenses: if you have a presently existing liability to pay an amount at 30 June, even where you may not have an invoice, the amount should be accrued to enable a tax deduction to be claimed in the current year.
• Prepaid expenses: If your business is a small business entity, you are entitled to a tax deduction where expenses covering a period of up to 12 months are prepaid.
• Bad debts: Review and write off bad debts to ensure a deduction in 2025 financial year.
• Bonuses to staff: if you pay bonuses to employees, a simple accrual may not be enough to ensure a deduction at 30 June.  To claim a deduction you must ensure that you have presently existing obligation to pay the bonus and that it is quantifiable.

Can we give you a hand?

If you would like any further detail on the above, or for an estimate of your tax position for the 2025 financial year, please contact your Holman Hodge advisor.

Background

Partners, David and Annabelle owned a pharmacy in regional Australia. For some years, David had been planning his retirement following the introduction of Brenton, a younger partner a few years ago.  Brenton quickly gained David’s and Annabelle’s confidence and was handed the day-to-day operations and management of the pharmacy, and the business thrived. They soon employed Jess, a young energetic pharmacist who was a great cultural fit with a ‘can do’ attitude. So, the idea of bringing her into the business ownership structure brought an opportunity for David to step into retirement sooner than expected.

With a new vision from Annabelle, the pharmacy made a bold move to change trading banners and move to the newly released WholeLife banner and business model. With Brenton leading the implementation, it introduced a new approach to health and wellbeing to complement their reputation and experience, and build closer customer relationships with an additional range of services. Jess had been integral in transitioning to this new model, embracing the new approach and opportunities it attracted.

All three Partners are clients of Holman Hodge, including the pharmacy business. There were three key challenges involved in onboarding Jess as a new partner and exiting David out of the business. They included:

1. Ensuring the pharmacy was valued fairly
2. Managing expectations and perceived conflicts as sole adviser
3. Structuring and timing of the sale.

Solution

Pharmacy valuation

Agreeing a fair price required an open and transparent approach. Whilst Jess played a key role when the business transitioned to the WholeLife brand, she was instrumental with its success and was cautious about not paying too much, considering the value Jess had created.

For David, his goals were a little different. He was moving into retirement and had financial and lifestyle goals he needed to achieve, hence David needed to maximise his exit value.

To balance these goals and manage expectations, it was agreed as a starting point the pharmacy would be valued by an independent valuer. From there, we also undertook our own valuation for comparison and prepared various ‘what if scenarios’ which ultimately enabled both parties to eventually settle on a fair price. The considerations in agreeing on a fair price included:

• The recent transition to the WholeLife brand and the resulting growth potential
• Past business performance
• Location of the pharmacy and local competition
• Jess’ contribution in making the WholeLife model work for the pharmacy
• The broader market conditions and market demand
• Recent pharmacy transactions and outcomes in particular external vs internal sales.

Managing relationships, expectations and perceived conflicts

Once the decision to offer Jess partnership was made, we needed to ensure the two main negotiating parties, David and Jess, each received non-biased advice and equally important that we were seen to act in their best interest.  In addition, we were conscious our advice remained impartial. David had been a longtime client of our Pharmacy Lead Director, Frank Morgante. Although Jess was not a client at the initial stage, she quickly acknowledged the high level of expertise we demonstrated and soon become comfortable enough to engage us. The Partners had also been gradually bringing Jess into the pharmacy management meetings over time, so that she was across the detail and decision making, in preparation for ownership. To manage perceived conflicts of interest and equity, we:

• Formalised the relationship and made it clear to our teams and our clients from the outset how we would be transacting including the steps required, ensuring our advice always remained impartial.
• Did not share confidential information from personal discussions with our own clients.
• Ensured transparency in the valuation process, the serviceability of debt, and pharmacy drawings to service the loan and partner equity.
• Provided transparent, detailed financial forecasts, explaining the rationale behind them.

Jess appreciated the time we spent together, going through the valuation, the serviceability of her loan, and what she was effectively purchasing, while David was assured that the price reflected his contribution to building and growing the business to date.

“Jacob at Holman Hodge was my direct contact throughout the buy-in process. Purchasing a share in the pharmacy was a new experience for me and did feel overwhelming at times. Throughout the journey, I appreciated Jacob and Frank’s expertise and patience as they guided and explained details in an easy-to-understand manner. Jacob was my main point of contact and was always readily available and happy to help with any questions, of which there were many! I look forward to continuing to work with Frank and Jacob in the future with both the business and my personal finances.”

Jess, new pharmacy owner

Structuring and timing of the sale

To support Jess in attaining the right ownership structure, we set up a new entity to hold her business interest and supported her with the right contacts and advice including through the financing process with the introduction of Tanya, a finance broker.

Timing and tax planning was also important to meet both parties’ needs. Aligning the transaction with the end of the financial year meant reliance on the one set of financial reports which saved time and costs. This also allowed the distributions to be more aligned to the quarter, so the settlement was completed by the end of September.

Frank also ensured that David had appropriate advice so that his financial goals were met, and he could exit the business debt free.

The end game

The outcome was a successful business transaction where both parties felt confident in the business sale process, but more importantly, both parties felt it was a win-win. Both parties were pleased that Frank and I were always available to answer their questions and act quickly on their behalf. We helped Jess to achieve a confident buy in and we know that David is relaxed and happy, enjoying his retirement in Queensland.
 

“We are very grateful for the professionalism and expertise provided by Jacob and Frank at Holman Hodge Accountants for their assistance facilitating a share sale between an outgoing and incoming business partner. Their guidance was clear, professional, and gave us complete confidence every step of the way. We particularly appreciated their ability to present solutions to unforeseen problems during the process. We truly value their partnership and look forward to continuing to work together.”  
Brenton, pharmacy owner

About the author

Jacob Prestia is a Manager at Holman Hodge. He understands that his work with pharmacy clients encompasses much more than just the figures presented in compliance and management reports. He fosters personal relationships that extend to providing advisory services on critical matters such as restructures, cash flow management, and transactions, in addition to supporting clients in areas like property ownership, syndication, and development.

Financial information can be creative too

Turning a creative pursuit into a commercial business is an exciting, rewarding journey – but it comes with its own set of challenges. As an advisor to creative clients, one of the biggest hurdles that I come across is that to understand your finances, they have to be presented in a way that makes sense to you – and that has challenged me to think more creatively in delivering meaningful information.

A standard set of financial reports is difficult for anyone to see where and how their business is thriving, especially when you are used to thriving on the visual details. If this sounds like you, you are not alone. Our role at Holman Hodge is to develop and interpret traditional financial reports, so we find the black and white lines of numbers interesting and telling. But if you’re not an accountant by trade, seeing where adjustments can be made simply by reading a profit and loss statement is difficult. I’ve learnt that to support our clients to pinpoint areas to focus on and truly use financial information as a decision making tool, financial data needs to be presented in a way that feels intuitive and engaging. When it comes to financial management of a creative business, traditional reporting at times doesn’t cut it. So, we’re now thinking more creatively when we present financial data too!

We’re proud to say that our financial reporting is far more colourful than it used to be, and it makes a huge difference as a decision making tool. One of the most effective strategies in supporting clients is to present financial data in a format that resonates with how they naturally process information – and that’s visually.

Let’s take, for example, a standard revenue statement and present a graphical representation of the revenue streams by geography, product line or sales channel – we can immediately see the results. Let’s look at a 2023 – 2024 financial year comparison, based on the product lines in a fashion house.

From the graphs above, it’s easy to see which product dominates the revenue mix (clothing) and where sales have grown in the past year (shoes). In the first column of graphs, you can see that sales of clothing represents 55% of the total sales in the year ended 30 June 2023. In the following financial year, overall sales grew by 30% and we can see that shoe sales and clothing were the product lines responsible. The trends are far easier to spot from these graphs and we can quickly see where we need to make decisions around distribution and sales support.

Our goal is to shift from overwhelming reports to meaningful insights that drive faster, better decisions.

Finding the right financial format for your decision making

Many creative entrepreneurs and business owners know that a standard financial report is challenging but don’t know what options or ways there are to make them better … until they see it! That’s why my process, of understanding your business and goals, starts with a conversation to find out:

1. What information do you actually need to know?
2. What are the biggest pain points in your business?
3. What would help you make quicker, more informed decision?

Once we identify the critical information and numbers we need, whether it’s from sales trends, cash flow, product pricing or breakeven points, we can then present you the data in different formats and refine it to suit your preferences.

Turning passion into profit

Turning passion into profit is not easy, regardless of being a creative or otherwise. It’s not only about being good at your craft, it’s about understanding your numbers in a way that works for you and using this to make better decisions.