The end of the financial year is an important time for your small business. You'll need to complete bookkeeping, tax returns and plan for the new financial year. Learn how to prepare for the EOFY to get your business organised and work smarter in the year ahead.
1. Check what record keeping and other tasks to complete
Some of the yearly tasks you need to do as a small business owner may include:
a summary of income and expenses in a profit and loss statement
conducting a stocktake – learn about stocktakes and assets on the Australian Taxation Office (ATO) website
summaries of your record of debtors and creditors
collating records of asset purchases or expenditure on improvements (to calculate depreciation expense claims and for capital gains tax)
completing and lodging your income tax returns
lodging yearly reports or returns for
pay as you go (PAYG) withholding including finalising income statements for single touch payroll
fringe benefits tax (FBT)
goods and services tax (GST)
the taxable payments reporting system
meeting superannuation requirements
making digital copies of any paper records and backing them up
For more information, visit the Australian Tax Office website, call the ATO on 13 28 66, or talk to your tax professional.
2. Find out what tax deductions and concessions you can claim
You can claim deductions for most business expenses, as long as they directly relate to earning your income. For example, 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
You must have records to prove the expenses that you claim as business deductions.
If you’re a sole trader, consider using the ATO app’s myDeductions tool to record your business income and expenses during the year.
Consider planning for the end of year. Try to write off any debtors or assets before the year ends to claim a tax deduction.
There are also a number of tax concessions available to support small business. Consider whether you can make use of some of these before the end of the financial year.
3. Check your tax agent is registered
Check your tax agent is registered with the Tax Practitioners Board (TPB).
There are two ways you can check:
Search the TPB register.
Look for the registered tax practitioner symbol on their website, stationery, brochures or business cards. The registered tax practitioner symbol includes the type of registration and their individual registration number.
4. Keep up-to-date with tax changes
There may be tax changes each year that you need to be aware of. These might include changes in tax law and deductions or concessions for small business. Your tax professional can help you understand any changes. You can also keep up-to-date by subscribing to the ATO’s small business newsroom.
5. Be wary of tax refund scams
There are a number of scams that target small business around tax time. Common tax time scams include:
tax refund scams – the scammer claims you’ve overpaid your taxes and are eligible for a refund. To get this refund, they claim that you need to pay a fee for administration or transfer costs.
tax owed scams – the scammer claims you've underpaid your tax and need to repay it immediately. In order to make this payment, they ask for your credit or debit card details, or ask you to send money through a money transfer, or they may ask you to purchase iTunes cards and send them the details of the cards.
6. Review your finances
Review your finances with your accountant or bookkeeper.
Look at whether you met your targets and what you can do differently next financial year. Create a cash flow forecast to:
manage any potential shortfalls
ensure you can still pay your staff and suppliers
7. Review your business and marketing plans
Take time to set yourself up for the year ahead. Regularly reviewing and updating your plans will help you to:
remember your goals and priorities
assess whether your strategies are working
adapt to any changes in your environment
make the most of new opportunities as they come your way
prioritise and maximise your effort (work smarter, not harder)
8. Review your business structure
As your business grows and expands, you may decide to change your business structure, or to restructure your business. The compliance and taxation regulations differ depending on your business structure.
9. Check your insurances
If your circumstances change, you may need to update your level of cover.
Read the product disclosure statements (PDS) for your insurance policies carefully. Don't assume you're covered.
A broker will work with your business to make sure you get the best deal from an insurance company.
10. Backup and secure your files
Backup and store your business information in a secure off-site location. Include:
registrations
financial information
customer data
Source: ATO.gov.au