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How to deliver tax savings to clients
How to deliver tax savings to clients

Deliver the best tax outcomes for your clients by following these simple tips.

Updated over a week ago

There's a few simple tips that can help save your clients a lot of tax.

Ensure the CGT discount is being claimed

Syla automatically calculates and determines which CGT assets have been held longer than 12 months and are eligible for the CGT discount. The CGT discount often has the largest impact on tax saving, so it's also worth communicating the tax saving to your client.

Tip: Don't forget to communicate the value of applying the CGT discount to your client. ”We were able to successfully apply the 50% CGT discount on eligible investments which reduced your net capital gain by $XXX”

Parcel matching optimisation (LTFO)

The parcel selection method often has the next largest impact on tax saving after the application of the CGT discount, so it's definitely worth having a look at. You can learn more here about the different parcel matching methods available in Syla.

For accounts that are on Syla's Tax Saving plan or above, you'll have access to our Lowest Tax First Out (LTFO) parcel matching method. LTFO is a tax optimised method of choosing which CGT parcel was sold.

The parcel matching method can be changed for each financial year, so even if you applied FIFO in prior years, you can start using LTFO for the current and future years.

There's a great opportunity here to also communicate the dollar value of the tax savings to your client.

Here's how you can calculate the actual dollar amount saved by using LTFO:

  1. Go to the Settings page and update the parcel method for the desired financial year to FIFO and click save.

  2. Wait for the tax calculations to finish updating, and then navigate to the Tax Reports page.

  3. Download the Crypto Tax Report and record the net CGT outcome.

  4. Go back to the Settings page and now update the parcel method for the desired financial year to LTFO and click save.

  5. Once again, wait for the tax calculations to complete, download the Crypto Tax Report and record the net CGT outcome.

  6. Calculate the difference between the two, the result is how much the capital gains were reduced due to LTFO.

You can now let your client know how much was saved by applying LTFO to their crypto investments. :)

Tip: Don't forget to communicate the value of applying LTFO to your client. “By electing to apply LTFO, we were able to reduce your capital gains this year by $XXX”

Ensure all fees are being claimed

Syla automatically record fees and capitalises them where possible. It's important that all the fees are present in the transaction set. If any fees are missing, then your client may miss out on claiming additional deductions.

The most common sources of fees are:

  • Brokerage fees (which are capitalised into the cost base of the CGT assets in the Trade)

  • Withdrawal fees

  • Network fees (for on-chain transfers of crypto)

Tip: The most common source of missing fees are withdrawal fees, as they are not always reported by exchange platforms. Syla can often determine the withdrawal fee for you even when it is missing, or when that's not possible the fees can be manually entered.

Consider structuring options

If the amounts your client is investing are significant, than you can consider if it is appropriate to start discussing structuring options with your client such as a Trust, Company or potentially through an SMSF.

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