Let me tell you a story.
Earlier this week, I had the pleasure of speaking with someone on LinkedIn, let’s call him Jason (not his real name).
Jason reached out to me as he had found my content to be of value to him and his financial situation (I get a kick out of this every time it happens).
After we had organised a time to speak, I started the conversation by asking Jason to give me a little bit of background and what had prompted him to reach out.
What he said was a familiar tale.
He had been working with an Accountant over the last few years helping him manage his employee share scheme (ESS/ESPP).
Problem was, Jason of course isn’t an expert on his employee share scheme or the tax law in Australia. So when he gave his financial information, and in particular the details regarding his ESS/ESPP to his Accountant to prepare his tax return, he would get a rude shock.
A big tax bill.
And worse, little or no explanation has to why from the Accountant.
Jason knew some of this tax came because of his ESS/ESPP but there was also extra tax he had to pay because of his Superannuation Contributions, which the Accountant didn’t want to talk about at all.
Sound familiar?
Lets call this being reactive with your Tax Return.
Now let’s look at Paul’s situation (again, name has been changed).
Paul is a client of our Financial Planning and Accounting business.
In working with Paul, we were able to help identify and estimate his Tax for the year before he lodged.
We were then able to help Paul find the money to set aside the funds (or provision) for this return.
When the Accounting team prepared his return, Paul knew how much he would have to pay in tax and had the money set aside.
He also had some tax to pay because of his Superannuation contributions, but we were able to show him how his Super Fund could pay this tax for him.
Result.
No tax surprise.
And Paul is able to focus on the Strategies we are working on with him to grow his wealth so he can retire much earlier than he thought possible.
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