Getting ready for tax time can be daunting for any business, be it small or large. A little preparation before the end of the financial year can save time (and money) when it comes to preparing year-end accounts and tax returns.
Good record keeping can ensure a smooth tax time, and all taxpayers, whether they are a business or Individual taxpayer, are advised to make good record keeping a habit. By gathering, sorting and keeping good financial records, you will ease the tax lodgement process for yourself and your accountant/tax agent.
Businesses are advised to keep an eye on the following :
- If your business carries stock, carry out a stocktake at the end of the financial year;
- Reconcile bank accounts, credit card accounts and petty cash;
- Compare Debtors and Creditors listings to amounts shown in the Balance Sheet to ensure they are reconciled i.e. there are no discrepancies;
- Reconcile GST and PAYG withholding accounts to the June quarter Business Activity Statement (BAS);
- Reconcile Wages and Superannuation per the Profit and Loss account to your PAYG Payment Summaries declared to the ATO;
- Make sure personal expenses have not been claimed as business expenses;
- Ensure that you have substantiation (i.e. copies of invoices/receipts) for all business expenses;
- Check that sales, particularly cash sale, have all been accounted for;
- Write-off bad debts prior to year end.
Make sure you have set up for Single Touch Payroll, which comes into effect from 1 July 2019, and is compulsory for all businesses, regardless of the size or number of employees.
Tax time does not have to be difficult or stressful if you are organised. Affordable cloud accounting packages provide a range of options to help keep you organised and record tour financial transactions in the correct manner.
And don’t forget to take advantage of the $30,000 instant asset write-off to invest in assets to boost productivity and profitability, and get an immediate tax saving at the same time.