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EOFY tips for SMEs

 

EOFY tips for SMEs

The End of Financial year is just days away, which means it is important to understand what your business can do to help navigate the EOFY easier.

Below are 5 key factors to consider when preparing your business for the EOFY.

Make sure your records are up to date

It is important to make sure you have all necessary records up to date including receipts and invoices to ensure that when the end of financial year approaches your business will be organised and ready to go.

Records may include:

  • Sales records
  • Invoices
  • Credit card and bank statements
  • Purchase expense records
  • Receipts
  • Motor vehicle records

Instant Asset Write-off

The $150,000 Instant Asset Write-off allows eligible businesses to claim an immediate deduction for both new and second-hand assets.

The asset must cost less than the instant asset write-off threshold and be purchased and used in the year that the write-off is claimed.

In order to be eligible for the $150,000 Instant Asset Write Off you must:

  • Have an aggregated turnover of less than $500 million

Assets must:

  • Cost less than the instant asset write-off threshold
  • Be purchased and used in the year the write-off is claimed.

Click here to see if your business is eligible and how you can apply.

Capital gains tax

If you sell an asset such as a property you will need to pay tax on the profit made, this is known as capital gains tax. It is important to report any capital gains or losses in your income tax return. Capital gains tax is a part of your income tax, it is not a separate tax. It is important that you are prepared for any capital gains tax that you owe and set aside funds to cover it.

Tax deductions and concessions you can claim

Deductions can be claimed for the majority of your business expenses. However, the deductions must relate directly to earning your income.

You may be able to claim deductions if your business:

  • Has set up a website
  • Has motor vehicle expenses
  • Uses diesel fuel
  • Operates at home
  • Has travel expenses
  • Uses machinery, tools, or computers

In order to claim deductions, you must have records to prove the expenses that you claim as business deductions.

Plan for the following year

As the EOFY approaches, take the time to review your business plan and make necessary changes that will help benefit your business as it continues to grow and expand into the new financial year. It is also beneficial for businesses to look at their business health and structure and look at how the business performed throughout the year. This will allow you to see what changes need to be put in place to help your business grow and succeed. 

Contact Morris today on 1300 4 MORRIS and talk to one of our finance specialists to see how we can assist your business this EOFY.