End of financial year (EOFY) sales are without doubt one of the biggest shopping events in Australia.
As June 30 approaches, retailers begin offering genuine discounts on brands and items that range from kitchen appliances to cars and computers.
Why is the timing so significant for EOFY sales, and why is there such a frenzy to purchase or sell equipment and goods of any kind?
Most EOFY sales are capitalising on the fact that business owners are looking to accelerate their purchases ahead of June 30 to avoid tax, so helping them out with a sale is generally not a bad thing at all.- Liz Wilson, Wilson Financial
The Australian financial year starts on July 1 and ends the following year on June 30. Business owners wrap up their books at the end of the fiscal year and begin finalising their tax time paperwork and accounting.
EOFY has always been when retailers are hoping to clear stock to bring in newer, up-to-the-minute equipment such as the latest phone, tablet or television. It's our job to help them.
It's traditionally the time your favourite stores offer huge discounts to get rid of last season's stock before June 30 arrives.
This makes it an excellent opportunity to grab those big-ticket items or clothing essentials that you need without breaking the bank.
Liz Wilson of Wilson Financial said EOFY sales benefitted both sellers and buyers.
"For the business owner buying, they are seeking to offset expenses against profits they've made so as to reduce their tax bill at tax time," she said.
"For larger assets such as new equipment, they can still take advantage of instant asset write-off, which accelerates the depreciation of new equipment. The savings to tax can be quite substantial, and business owners should definitely be speaking to their accountants about this now.
"For the sellers, it may be a way to markdown and liquidate stock at written down values to save on tax, too."
Up to June 30, retailers are keen to shift their old stock to make way for fresh items, and they'll be slashing prices on plenty of products - which could be tax-deductible if you use them for work-related or work-from-home offices.
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