Easy Tax-Saving Tips for Consultants Using Cash Basis Reporting

If you run a consulting business (IT, marketing, finance, engineering, coaching, etc.) and report on a cash basis, there are simple, legal strategies to reduce your taxable income before 30 June.

Here are the two most effective ones for consultants.

Prepay Expenses (Up to 12 Months) — Immediate Deduction

Cash-basis reporting lets you deduct certain prepaid expenses as soon as you pay them, as long as the benefit is for 12 months or less.

Perfect for consultants who rely on subscriptions and professional services.

✔ Software & tools

• Microsoft 365 / Google Workspace

• Xero / QuickBooks

• CRM tools: HubSpot, Zoho

• Asana, Monday, Trello

• Cybersecurity software

• Dropbox / OneDrive storage

✔ Professional & operating costs

• Accounting and tax agent fees

• PI insurance / business insurance

• Industry memberships

• Training & certification courses

• Website hosting & domain renewals

• Advertising subscriptions (LinkedIn Ads, Meta Ads)

💡 Prepaying even $2,000–$5,000 of these costs before 30 June can reduce your taxable income this year, not next year.

💡 A typical consulting business spends $2000 on subscription services, that can effectively save you $2000 * 12 Months * 25% Tax Rate = $6000 Tax Saving

Delay Revenue — Don’t “Complete” Work Before 1 July

Under cash basis, income is generally recognised when you receive payment, but for many consulting contracts, final payment only becomes payable once a project or milestone is completed.

This creates a legitimate tax planning opportunity:

If you delay project completion until after 1 July,

the invoice (and the cash you receive) can legally fall into the next financial year, reducing this year’s taxable income.

This is common for consultants who work with:

• project milestones

• deliverables-based billing

• end-of-project final sign-off

• stage-based payments

• completion certificates

Examples

• You’re 90% done with a report — finish and deliver it on 2 July, not 28 June.

• Push a milestone meeting to the first week of July.

• Delay final sign-off if the client agrees.

This moves income into next year, smoothing your taxable profit without breaking any rules.

⚠️ Important: This must reflect actual work timing — you cannot artificially delay invoicing if the project is already completed.

Using Accrual Instead of Cash Basis?

Accrual businesses can still apply powerful timing strategies around:

• debtors and creditors

• WIP timing

• expense recognition

• provisioning

👉 Comment below and I’ll send you a simple cheat sheet for accrual-basis consultants.