Recent studies have revealed that small businesses that follow best practices regarding record keeping, and tax essentials consistently outperform their competitors. Therefore, with the end of the financial year (EOFY) on our doorstep, it pays to be prepared.

EOFY can be an exhausting time for many, and now with the added complications of COVID-19 it may seem even more of a daunting process.

The below last-minute tips will help your business gain maximum benefits in this financial year and the next.

Talk to an Expert

Now is the perfect time to contact your tax agent and make an appointment to prepare your business income tax return.  Working with an expert can help take some of the stress out of tax time, they have the knowledge and skills to assist your business to stay compliant, in what can be a complicated tax world.

Accurate Records

The most important thing to do when preparing for EOFY is to record everything. To prepare an accurate tax return you need to keep careful records. You should record all information that relates to receipts and correspondence around payments you have received and around anything you have spent on the business, any assets you have acquired or disposed of, gifts or donations, GST and payroll information.

Whilst accounting programs help you keep track of a lot of these records, ensure you also keep physical or digital copies of receipts, invoices, logbooks and other expense-related material if you are to be audited. Legally you are required to keep full account records for up to five years.

Understand your deductions

It is important that you find out what deductions you are entitled to claim in order to maximise your benefits.

There are a range of things you can claim as deductions for your business, such as website expenses, uniform and working from home expenses.

The official ATO app has a tool called mydeductions which is designed to assist you with this process.

You may also be eligible to claim tax deductions on certain assets such as vehicles, equipment and machinery. This can be done under the temporary full expensing scheme which was recently extended until 30^th June 2023. It allows your business to claim a tax deduction for the total value of a purchase.

Review

The end of the financial year is the perfect time to review and reimagine your businesses health and plan for the future.

With all of this reporting, stocktaking and assessing your finances, you may look to implement solutions such as cloud-based software to help streamline your business to make EOFY as easy as possible.

When it comes to EOFY, proper planning is paramount, and when it comes to finances it’s never too early to start doing so.

It’s time to get prepared and tick tax time off, so you can get back to growing your business.

If your business is looking for other opportunities to maximise their profitability in the new financial year, whether it’s through equipment financing, capital raising or restructuring your current loans, Morris Finance can help. Simply call 1300 4 MORRIS and speak to one of our finance specialists to see what we can do for you.