Tax Advice: Why It’s Important + How It Can Save You Money

Tax Advice: “Do I Really Need It?”

Nobody likes paying taxes—but what if you’re paying more than you have to? Without the right tax advice, you could be leaving thousands on the table.

Great advice doesn’t just help you survive tax season, it helps you plan your deductions all year round (also called “tax planning”).

It’s the difference between rushing to file a tax return and confidently growing your wealth and business (by using highly effective, legal tax reduction strategies).

But what exactly is “tax advice”, and why is it so powerful?

Let me explain how it works, why it matters, and how it could level up your financial setup.

What Is Tax Advice?

Tax advice involves professional guidance on managing your taxes effectively and legally. It covers a wide range of areas, including:

• Tax Compliance: Ensuring you meet all obligations under the law, such as filing accurate tax returns and paying the right amount.
• Tax Planning: Strategically arranging your finances to minimise your tax liability while staying compliant.
• Deductions and Credits: Identifying the maximum allowable deductions, credits, and incentives to reduce your tax bill. Reviewing them each year to identify additional opportunities (usually in May/June each year).
• Business Structuring: Advising on the best legal structure for your business to optimise taxes.
• Tax Disputes: Helping with audits, objections, or disputes with the ATO.

Tax advice is about making sure you don’t pay more tax than you need to while staying on the right side of the law. It’s especially worthwhile if you have a growing business, if you’re a high income earner, or if you’re moving overseas.

Why Is Tax Advice Important?

Tax advice isn’t just for the wealthy or big corporations. It’s important for anyone who wants to save on tax, improve their financial situation, and avoid costly mistakes.

Benefits of Good Tax Advice

• Save Money: A skilled tax advisor can uncover deductions and credits you may not have known about (especially industry-specific incentives or business restructuring).
• Stay Compliant: With tax laws constantly changing, expert advice ensures you meet your obligations.
• Reduce Stress: Having an accountant review your taxes gives you peace of mind.
• Plan for the Future: It helps you make informed decisions about investments, savings, and business growth.

Risks of Bad Tax Advice (or No Advice at All)

• Overpaying: Without proper advice, you’ll likely out on deductions or overpay on your taxes (which is completely avoidable).
• Penalties: Incorrect filings or non-compliance can result in fines, audits, or legal trouble.
• Missed Opportunities: Bad advice could mean losing out on financial strategies that save money over time.

How Tax Advice + Tax Planning Works:

Tax advice isn’t just about ticking boxes—it’s about understanding strategies that maximise your savings while staying compliant. Here’s how the process works, with some examples of real-world tactics:

1. Deep-Dive Into Your Financials

A tax advisor starts by analysing your income sources, expenses, business structure, and investment portfolio. They’ll identify where you’re leaving money on the table and highlight risks like non-compliance or tax inefficiencies.

2. Advanced Tax Strategies

Beyond the usually deductions like work-related expenses, rental property interest, or payroll deductions, a savvy tax advisor might recommend the following:

• Debt Recycling: This is where you replace or ‘recycle’ the debt in your family home with tax-deductible debt from investments (usually a rental property). You want to pay off your non-deductible debt first, and claim the full interest expense on your investments.
• Superannuation: If you’re paying your staff superannuation late, you’re not allowed to claim it as a tax deduction. I saw a client that was paying $130k in super every year, but they missed out on this entire deduction because they paid it late. Once we got them paying on time, they saved $32,500 in taxes per year.
• Payroll Tax: You might choose to hire company-based contractors instead of employees, which could reduce your payroll tax bill. They must be legitimate contractors and be exempt for payroll tax (this varies by state).
• Business Structuring: A tax advisor might recommend setting up a discretionary trust or family trust for income splitting. This allows you to distribute profits to family members on lower tax brackets, reducing your overall tax paid. This is especially helpful if you have adult children who aren’t working full-time yet.
• Capital Gains Tax (CGT): Timing the sale of your assets is critical. If you sell an asset after owning it for more than 12 months, you may be eligible for the 50% CGT discount. There are also tax strategies for small business assets which could save you from paying CGT. If you’re leaving Australia, you’ll also want to look into deemed disposal which could save you lots in capital gains tax when you decide to sell.
• Salary Packaging: For high-income earners, salary sacrificing into superannuation or a novated lease is a smart way to reduce taxable income and get tax benefits.
• Bring-forward deductions: Your tax accountant might also suggest bringing forward deductions into the current tax year. If you’re planning on making an asset purchase or other purchases, you can bring them forward to claim in the current tax year (i.e. spend early). Don’t just make a purchase to get a tax deduction though.

There are various tax strategies available and your tax advisor should let you know the best strategy for your situation (and explain how it works).

3. Ongoing Monitoring and Advice

Tax isn’t a one-and-done job. An advisor provides continuous updates, adapts strategies when laws change, and ensures you’re always maximising deductions.

If you need once-off tax advice, like for an asset purchase or investment property setup, you can pay for project-based advice. It’s usually $750-1,000+ based on the time involved.

Make sure to work with someone who knows what they’re talking about. You can verify what they tell you on the ATO website. Ask them for links so that you can learn and understand what they’re recommending. If in doubt, get a second opinion.

Keeping Track Of Your Deductions

To help get the best tax advice possible, you need to have an organised business and financial setup. Track your expenses, deductions, income, and expenses, regardless of if you have a business or are a solo worker. The more information you can give your tax advisor, the better.

• Track Expenses: Keep receipts, invoices, and records of any costs related to earning your income. You can take photos of receipts or get a basic Xero subscription to track everything (or use good ol’ fashioned Excel).
• Understand Deduction Rules: Research what’s claimable in your industry. The ATO creates cheat-sheets for each industry. For example, a graphic designer can claim software costs, while a tradie might claim tools and driving costs. Plus, while cars are not generally deductible, utes are (they are classified as a “work-horse vehicle“).
• Use Tax Software: Platforms like myTax or Xero simplify your taxes and help you identify common deductions.
• Get Help If You’re Unsure: For complex situations or larger claims, consulting a tax advisor can ensure you don’t miss anything important.

Tax advice is all about strategy—whether you’re doing it yourself or working with a professional, the right approach can save you time, stress, and money.

Benefits of Tax Advice

While some people handle their taxes on their own, there are many scenarios where professional advice is important:

• Complex Finances: If you have multiple income streams, investments, or property, it can simplify your situation.
• Running a Business: Business owners face unique tax challenges, from GST and BAS to payroll and superannuation.
• Life Changes: Events like buying a home, getting married, or starting a business can affect your tax situation.
• International Income: If you earn money overseas, a tax advisor can help you navigate double taxation treaties and other rules.

In short, if your finances go beyond a simple salary, tax advice is a worthwhile investment.

The Cost of Tax Advice

The cost varies depending on the complexity of your situation and the expertise of the advisor.

Typical Costs:

• Simple Tax Advice: $500–$1,000 for one-off advice or consultations (e.g. deciding the most tax-effective way to purchase an investment property).
• Ongoing Tax Planning: $500–$2,000+ annually for personalised planning and support (e.g. group tax planning for businesses + individuals).
• Specialist Advice: $2,000+ for complex cases like international tax or business restructuring (this could also include asset protection strategies).

While these fees might seem high, good advice will pay for itself by saving you money and avoiding costly mistakes.

The Risk of Bad Tax Advice

Bad tax advice—or relying on none at all—can be expensive in the long run. Risks include:

• Missed Deductions: You could overpay thousands by claiming incorrect expenses.
• Audits: Poor advice increases your risk of being audited, which can be time-consuming, expensivex and stressful.
• Penalties: Late or incorrectly claiming deductions can lead to big fines from the ATO.

Examples of Tax Advice in Action

Here are two scenarios that show the difference between good and bad advice.

Example 1: A Freelancer Finds Hidden Deductions

The Situation: Jane is a graphic designer working as a freelancer in Sydney. She handles her own taxes and only claims basic deductions like her laptop and internet.

The Problem: Jane misses out on several deductions she’s entitled to, including:

• A portion of her rent, internet, and electricity for her home office.
• Depreciation on office furniture + equipment
• Software subscriptions and professional memberships.

The Solution: After hiring a tax advisor, Jane learns about these deductions and adjusts her tax return. She ends up saving $2,850 in taxes in her first year alone.

Example 2: John’s Cafe Gets Audited by the ATO

The Situation: John runs a café in Sydney. He relies on a friend to handle his taxes, but they make a mistake when calculating GST. The ATO audits John’s business and discovers several errors.

The Problem: John faces penalties and back taxes totalling $10,500. He has to set up a payment plan with the ATO to pay it off.

The Solution: After the audit, John hires a professional tax advisor. They help him set up proper bookkeeping practices and ensure future GST submissions are accurate, saving him from further issues.

How to Find Good Tax Advice

If you’re ready to seek tax advice, here are a few tips to find the right professional:

• Look for Credentials: Choose a registered tax agent or accountant with CPA or CA qualifications.
• Check Reviews: Look for testimonials from satisfied clients (Google Maps or LinkedIn).
• Ask Questions: During an initial consultation, ask about their experience with cases like yours. Make sure they’re experienced in providing tax advice (not all accountants are).
• Compare Costs: Don’t just go for the cheapest option—consider the value they provide. Pay more to get it done right. It takes time to research your specific situation and review your personal and business information.
• Communication: Make sure you understand what they’re doing. What strategies do they use? Are they proactive about helping you save tax? Do they have a good relationship with the ATO?

Ready to Get Tax Advice?

Tax advice is a smart investment that can save you money, reduce stress, and set you up for long-term financial success.

Whether you’re a freelancer, a property investor, or a business owner, the right advice can be an absolute gamechanger (trust me, I know from experience!). Take the time to find expert advice that works for you—you’ll thank yourself when you see the results.

Need helping finding an expert accountant? Want someone who knows your industry? Adventure Tax can help. To find out more, book a free call with me here.

Start your search today and take the first step towards a lower-tax future. Less tax = more freedom!

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