In our last tax article we talked about what types of expenses can be claimed for business owners. The clock is ticking so it’s now time to review our checklist and see what's outstanding.

It’s always a hectic time of the year for small businesses but as the age-old adage goes ‘proper planning prevents poor performance’ so put aside some time now to ensure your bookkeeping and financial documents are in order.

In our last tax article we talked about tax compliance standards for business owners and what types of expenses can and cannot be claimed and when they can be claimed.  It’s now time to review the checklist and make sure you’re properly prepared.

1.       Record keeping and compliance

Some of your yearly responsibilities as a small business owner may include:

  • Summarising income and expenses in a profit and loss statement
  • Conducting a stocktake
  • Summarising your record of debtors and creditors
  • Collating records of asset purchases or expenditure on improvements to assets to calculate depreciation expense claims and for capital gains tax purposes.
  • Completing and lodging your income tax return
  • Lodging yearly reports or returns for PAYG withholding, fringe benefits tax (FBT), Goods and Services Tax (GST), and the taxable payments reporting system.
  • Meeting SuperStream requirements

2.       Research what tax deductions you can claim

Our article on the Federal Budget goes into detail on the newly-available tax breaks to you as a small business. One of the most notable breaks is that you can immediately depreciate any eligible asset costing less than $20,000 purchased from 7.30pm on 12 May 2015 until 30 June 2017. This means you'll be able to deduct the assets in the financial year in which you first use or install the asset.

Other measures include:

  • Immediate deductions for professional services for costs relating to start a business. This change applies from the 2015-16 income year.
  • Changes to FBT and Capital Gains Tax (CGT) to reduce red tape for small business. These changes apply from 1 July 2016.

We also offer more detail in a sector-by-sector breakdown of the budget so make sure you’re aware of the expenses you can claim.  As a general guide you may be able to claim deductions if your business:

    • has set up a website
    • has motor vehicle expenses
    • uses diesel fuel
    • is based at home
    • has travel expenses
    • uses machinery, tools or computers.

3        Assess your finances

Assess whether you met your targets last financial year and what you can do differently next financial year. Set performance targets for the year to help you stay on track. Ask your accountant or bookkeeper to help you with summaries and easy-to-understand snapshots of what can be improved.  

Create a cash flow forecast to manage any potential shortfalls and ensure you can still pay your staff and suppliers.

4.     Check your business and marketing plans

Use this time to plan ahead so that you stay on track during the busy times. A good business plan will help you remind yourself of goals and priorities and assess whether your strategies are working. A marketing plan is equally as important because successful online marketing is not about luck, it’s about having a strategy to succeed. Find out more with our article here.

5.     Review insurance cover and general housekeeping

Check that you have the right insurances in place for your business. If your circumstances have changed, 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. Look up the definition of certain terms such as floods as they may vary among insurers.

Backup and store your registration, financial and customer data, and other important business documents in a secure off-site location. This can help ensure your business can stay up and running during unexpected events, such as natural disasters.

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