# RateRight Tax Optimisation Plan

**Date:** 2026-02-08
**Status:** PLANNED — not yet actioned
**Review trigger:** When revenue hits 15+ hires/month

---

## 1. Home Office Rental Arrangement

**Setup:** Rent 2-bed apartment in Maroubra, sublease 1 room to RateRight as office

| Item | Detail |
|------|--------|
| Apartment rent | ~$850-900/wk ($3,683-3,900/mo) |
| RateRight pays Michael | $650/mo (market rate — comparable to Anytime Offices Botany) |
| Housemate pays Michael | ~$300-350/wk ($1,300-1,517/mo) |
| Michael's net housing cost | ~$1,516-1,733/mo |
| RateRight annual deduction | $7,800/year |
| Comparable: current pub room | $330/wk ($1,430/mo) |

**Requirements:**
- Written rental agreement between Michael and RateRight Pty Ltd
- Market rate (proven by Anytime Offices Botany at $650/mo for 1-person office)
- Dedicated room used as office (photos, desk setup)
- Lease must allow subletting — get landlord consent in writing
- Michael declares rental income on personal tax return
- ATO example on their website matches this exact setup (Gary's Tunes Pty Ltd)

**When:** When Michael moves out of current pub room

---

## 2. Phone — Business Use Split

| Item | Detail |
|------|--------|
| Vodafone bill | ~$60-78/mo |
| Business use estimate | 70% |
| RateRight pays | ~$42-55/mo |
| Annual deduction | ~$504-660 |
| Setup | Auto-payment from Airwallex for business portion |

**When:** Immediately — just split the payment

---

## 3. Internet — Business Use Split

| Item | Detail |
|------|--------|
| Home internet (when apartment) | ~$80/mo |
| Business use estimate | 50% |
| RateRight pays | ~$40/mo |
| Annual deduction | ~$480 |

**When:** When apartment is set up

---

## 4. Equipment Purchases

Buy through RateRight (Airwallex card), 100% deductible:
- Laptop/computer
- Monitor, keyboard, mouse
- Desk and chair
- Any office equipment

**Rule:** Must be genuinely for business use. If mixed use, claim business portion only.
**When:** Ongoing — just use the business card

---

## 5. Car / Travel — Logbook Method

| Item | Detail |
|------|--------|
| ATO rate | $0.88/km (2025-26) |
| Estimated business kms | ~100km/wk |
| Monthly deduction | ~$380/mo |
| Annual deduction | ~$4,576 |
| Logbook required | 12 weeks, then valid for 5 years |
| App | "ATO Vehicle Log" (free) |

**Business travel includes:** Meeting contractors, site visits for RateRight, going to meetings, business errands
**Does NOT include:** Commuting to construction job

**When:** Start logbook whenever ready. 12 weeks of tracking then done.

---

## 6. Professional Development

Fully deductible through RateRight:
- Business courses (marketing, management, construction industry)
- AI/coding courses (building the product)
- Books and publications
- Conference tickets
- Industry memberships

**When:** Ongoing — buy through business card

---

## 7. Business Meals & Entertainment

| Item | Detail |
|------|--------|
| Deductible | 50% of meal cost when meeting clients/contractors |
| Requirement | Keep receipt + note who you met and business purpose |
| Example | Beers with a contractor discussing RateRight = 50% deductible |

**When:** Ongoing — keep receipts, note the business purpose

---

## 8. Superannuation Top-Up

| Item | Detail |
|------|--------|
| Concessional cap | $30,000/year total (all sources) |
| Construction employer pays | ~$9,200-10,350/year (est. 11.5% on ~$80-90k) |
| Remaining cap space | ~$19,650-20,800/year |
| RateRight can contribute | Up to remaining cap ($1,667/mo max) |
| Tax saving | ~17-22% vs marginal rate (~$3,400-4,400/year) |
| Super tax rate | 15% (vs 32.5-37% marginal) |

**⚠️ DO NOT exceed $30k cap — penalty is harsh**
**⚠️ Check construction employer's YTD contributions first**
**⚠️ Money locked until age 60**

**Trigger:** Start when RateRight revenue hits 15+ hires/month consistently
**Start small:** $500-1,000/mo, increase as revenue grows
**End of FY move:** If RateRight has profit in June, lump sum to reduce company tax

---

## 9. Salary from RateRight (Future)

Once revenue is flowing:
- Pay yourself a modest salary from RateRight
- Company gets deduction at 25% rate
- Structure salary + super + office rent to minimise total tax
- Consider: tax-free threshold ($18,200) already used by construction income

**When:** Once revenue is consistent. Needs accountant input on optimal structure.

---

## Estimated Total Annual Tax Benefit (When Fully Set Up)

| Strategy | Annual Deduction | Est. Tax Saving |
|----------|-----------------|-----------------|
| Home office rent | $7,800 | $1,950 |
| Phone | $600 | $150 |
| Internet | $480 | $120 |
| Equipment (est. Year 1) | $3,000 | $750 |
| Car/travel | $4,576 | $1,144 |
| Meals (est.) | $1,200 | $300 |
| Super top-up | $20,000 | $3,400-4,400 |
| **TOTAL** | **~$37,656** | **~$7,814-8,814** |

*Tax savings estimated at 25% company tax rate. Super saving calculated differently (marginal rate vs 15%).*

---

## Action Required

1. **Now:** Switch phone payment split to Airwallex (70% business)
2. **Now:** Start buying business equipment on Airwallex card
3. **When moving:** Set up rental agreement for home office
4. **When ready:** Start 12-week car logbook
5. **When revenue flows:** Begin super contributions
6. **Before June 30:** Review with accountant for FY25-26 tax position
7. **Get a bookkeeper:** $100-150/mo to manage Xero categorisation

---

## Xero Setup Checklist

- [ ] Connect Airwallex bank feed to Xero
- [ ] Set up chart of accounts (business expenses, office rent, phone, internet, equipment, travel)
- [ ] Set up recurring transactions (office rent, phone split)
- [ ] Enable receipt capture (forward receipts to Xero email)
- [ ] Consider bookkeeper ($100-150/mo) to categorise transactions weekly

---

*All strategies are ATO-compliant. Recommend reviewing with accountant before implementing super contributions and salary structure.*