Pay Less Business Tax by Investing in Your Business
There is a strong business case for investing in your business before the financial year ends. The biggest reason clever companies make investments this side of June 30th is to avoid paying extra tax on ‘paper profits’, which they could otherwise easily reduce by purchasing things that will benefit them and help increase growth in the year ahead.
Why it Makes Financial Sense
By making savvy and strategic investments before EOFY, your business effectively saves 25% (or more) on any expense paid for between now and the end of June. To put it another way, you get taxed 25 cents on every dollar of profit you make — so by ‘reducing’ that profit by making smart outlays before tax time, you’ll end up paying less to the ATO. Smart, huh?
Your business can make fast gains whilst avoiding excess tax by investing in:
A New Website
A New eCommerce Website
If you have something to sell, there are so many critical points along the purchasing journey where potential customers will either buy or bail. With an upgrade in product photography and descriptions, adding genuine customer review features for social proof, and a flawless cart experience — you can increase your spend per sale, your average customer value, and your customer retention rates. Again, if your conversion to sale isn’t above 3%, there’s critical work to be done that will make an enormous difference to your bottom line.
Search Engine Optimisation
The number one organic search result is 10 times more likely to receive a click compared to a page in the tenth spot. (Honestly, when was the last time you went past page one —or maybe page two at a stretch— to find a website?) SEO is critically important to make sure your website is appearing in high organic search results for relevant search terms. If you’re not on page 1-2 for your most important search phrases, there’s critical back-end work to be done on your website (and behind your website) to improve your rankings, ASAP. As a handy tip, adding a blog to your website and keeping it updated with regular content can increase its chances of ranking in search engines by 434%.
Did you know that on average, 41% of clicks go to the top 3 paid ads on the search results page? And even though we just stressed the importance of SEO above, A shocking 60% of people can’t tell the difference between Google ads and organic search results. So whilst you’re playing the long-game waiting for your website to climb to the top organically, you can make very quick wins with paid ads. One of the benefits of paid ads is that they are pay-per-click, but free to display. So even if you don’t get a click, you can still get eyeballs on your brand. It’s unsurprising then, that search ads can increase brand awareness by 80%. They are especially beneficial if you’re an eCommerce business, as people who click on ads are 50% more likely to purchase something than organic search visitors.
Whether you’re a daily TikTok-er or don’t even have Facebook, there’s no denying the power of social media in 2022. If you have an eCommerce business, know this: consumers are six times more likely to make a purchase from a product page that includes pictures from social media.
Social proof has never been more important. 81% of consumer purchasing choices are influenced by friends’ posts on social media.
Working with social media professionals to fill your organic social media accounts with in-demand content is vital. And following up with targeted, relevant advertising on social media delivers cumulative rewards.
Business: The Smart Investment in 2022
With previously trusted investment categories like shares, real estate and cryptocurrency seeing unprecedented losses around the world, it’s time to refocus on the basics: business growth. Bread and butter. Doing what made you money in the first place. Being the best in your category, and communicating that to your audience.
Symbolically, coming out of a global pandemic also creates a great opportunity for reconnection and exciting new projects. We have loads of great ideas to help you reach out and connect with your audience. Make July 1st your starting point!
How to Minimise Tax This Financial Year
- Bring forward your expenses. Spend the money now to get the deduction sooner.
- Purchase consumable items before June 30 (includes basics like stationery, collateral, banners and printing – our sister agency, Bellman does lovely work in this category).
- Use Retainer Models. Buy a block of service hours which you can use throughout the next quarter.
Want to discuss options for savvy spending in June?
Book a zero obligation, one-hour digital strategy meeting in June, and it’s on us!
Our Digital Marketing experts deliver thoughtful recommendations to help you achieve your digital vision and cut through the online clutter.
Book your free strategy session: (03) 9855 2599
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