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Tips & Tricks 2 June, 2017

Tax Time Preparation For Small Businesses & Entrepreneurs

Checked your calendar lately?…. Tax time is fast approaching so if you’re a small business owner now’s the time to get organised. But never fear, the end of financial year doesn’t have to feel like a bad hangover. Preparation is key so start now – we’ve put together a checklist to ensure you’re immune to EOFY chaos.

Get It Together

It’s vital that you’re organised at this time of the year. Prepare for tax time to avoid unexpected issues or extra demands. Identify any tasks and complete them; ensure your records are up to date, check that you meet all the ATO requirements and that you have all the necessary supporting documentation ready including expense reports and balance sheets.

Follow The Money

Be sure to chase down any debts from clients before 30th June; ideally you don’t want anything outstanding from the previous tax year. Identify what assets you have that can be upgraded and which ones can be written off. Likewise, consider whether you’re intending to make any purchases before 30th June; like vehicles, equipment or computers.

Know Your Legislations

What do you mean? As a small business it is important to remain in-the-know on any tax legislation amendments that may affect your business. You can discuss these with your accountant. At the same time, be sure to also discuss how your business has made changes in the past year that may affect your tax obligations.

Evaluate Investments

EOFY is the perfect opportunity to make new investments and improve your business.

It is advisable to take your time and start the process now so you can be smart about where you invest, and always ensure you’re receiving the right advice from an expert. There may be tax implications from your purchases so talk to your accountant beforehand to check you won’t run into any complications.

What You Need To Avoid

1. Don’t neglect your accountant’s expertise. If you’re considering an investment or unsure of what documents the ATO requires, always ask an expert.

2. Don’t be ignorant of dates. Ensure you are 100% aware of the ATO’s deadlines for lodging relevant documents and reports. Likewise, ensure you’re paying your taxes in instalments.

3. Don’t be careless when it comes to keeping your records. Be thorough, because it’s an easy mistake to miscalculate transactions or lose relevant documents.

4. Don’t let your cash-flow come to a halt. Chase up any debts and ensure you’re aware of your financial standing at all times.

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