Tax Time is approaching quickly but many business owners leave their tax time preparation till the night before their tax accountant appointment.
There is an incredible amount of value in putting some thought into some aspects of your accounts early on and today I want to share them with you. They may just save you some money as well as some headaches!
Of course, I highly recommend that you keep up to date with a lot of these areas throughout the year and in fact, many of these steps are ones that I go through monthly with my clients during our reviews.
If you don’t complete a review process like this though it’s not too late to get on track before tax time comes around.
Tax Time Preparation Steps:
- Income – Review how much income you have made so far this year and what you are expecting to make by the end of the financial year. Think about whether this is where you wanted to be at this point in your business? Do you need to implement new strategies for the coming financial year or adjust any of your goals?
- Expenses – Have a look at your existing expenses but also consider whether there are additional expenses you would like to make before the financial year ends. For example the Immediate Asset Deductibility threshold which enables small businesses to immediately deduct the business portion of most assets if they cost less than $20,000. https://www.ato.gov.au/general/new-legislation/in-detail/direct-taxes/income-tax-for-businesses/extending-the-immediate-deductibility-threshold-for-small-business/
- Bookkeeping – Ensure that all your regular record keeping is up to date. Hopefully you are pretty close to this already but if you aren’t it is definitely time to either get on top of it or engage someone asap.
- Business Structure – Now is also a great time to look at your current business structure and whether this setup will still work for you in 2018/19. In particular you want to look at issues such as GST registration based on your current income.
- Budgeting – I recommend ongoing budgeting to all my clients but the end of financial year is an especially important time to assess the whole year and look at your budgeting and forecasts for next financial year.
- Tax Reduction – There is no point waiting till after the year ends to look at reducing your tax liabilities. If this is something you want to investigate it is worthwhile contacting your tax accountant now to see what strategies you can put into place.
- Yearly Reflection – Just like you need to reflect and assess your business goals, your financials deserve the same attention. Have a look at what worked well for your business, what didn’t work as well as expected and why you may not have met the targets you wanted.
Lastly if all this seems too hard and you feel like you don’t know where to start my best advice would be to engage a bookkeeper or accountant now. Financial professionals are not there to just add up your figures but they provide an invaluable source of advice when it comes to implementing systems and processes to get you back on track and help you grow your business.
If you would like to chat to Grace about your bookkeeping and accounting needs you can book in a time to chat here.