Clay soil is nice because it holds water, and nutrients quite well. However, it's often too hard and dense to grow things. I would suggest adding lots of compost and organic matter, and tilling this into the soil. Peat moss is especially good at giving the soil a better texture, but it can make the soil more acidic, so be careful. Unfortunately, one application of compost/peat moss, is not going to remedy the soil permanently. Usually such additives have to be reapplied each year, so a rototiller might be a wise investment! Over time, the soil will become looser, so not as much organic matter will have to be added. Another option is to use raised beds. If you build them at a medium depth, you could till some of the native soil into a large overlayer of better compost amended soil. Red soil also indicates that the soil has been heavily leached by rainwater, so you might want to do a soil test to make sure that you have enough nutrients in the soil for your plants. Adding compost will also help any nutrient deficiencies.
Hope that helps!
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