End of the financial year checklist for businesses: 2024 edition
End of the financial year checklist for businesses: 2024 edition
- cb-admin
- June 3, 2024
- 2:54 am
Navigating the end of the financial year (EOFY) can often feel like diving into a labyrinth of paperwork and deadlines, but fear not! As EOFY approaches, it presents an opportunity for small and medium business owners to not only ensure compliance but also to strategise for future growth. While the thought of tax time may induce a bit of anxiety, especially for those not accustomed to its intricacies, it doesn’t have to be a headache. In fact, many savvy entrepreneurs have mastered the art of simplifying and streamlining EOFY processes, allowing them to focus on what truly matters – steering their businesses towards success.
Picture this: instead of scrambling through heaps of receipts and invoices, you are confidently ticking off tasks on a well-structured checklist, knowing that each item brings you closer to financial clarity and strategic insights for the year ahead. With the right approach, EOFY can be transformed from a daunting chore into a golden opportunity to optimise your business’s financial health and set a solid foundation for the future.
So, whether you’re a seasoned business owner looking to refine your EOFY strategies or a budding entrepreneur seeking guidance through the maze of tax obligations, this comprehensive checklist is your roadmap to success. From maximising tax deductions to embracing automation tools, each point in this guide is designed to empower you to take control of your finances and propel your business towards greater heights. Get ready to conquer EOFY like a pro and unlock the full potential of your business’s financial journey! Trust Kingsford Bookkeeping.
1. Check what tasks you need to complete
As a small business owner, your annual responsibilities encompass various tasks crucial for financial management and tax compliance. These include compiling income and expenditure details into a profit and loss statement, conducting stock takes to assess inventory, maintaining records of debtors and creditors, documenting asset purchases for depreciation claims and capital gains tax, and filing income tax returns. Additionally, you’ll need to fullfill obligations such as PAYG withholding, including Single Touch Payroll reporting, managing fringe benefits tax and GST, meeting superannuation requirements, and ensuring proper digital record-keeping by creating backups of paper records. These tasks collectively ensure smooth operations and regulatory adherence for your business’s financial health.
2. Find out which tax deductions and concessions you can claim
As a business owner, you’re eligible to claim deductions for various expenses directly related to generating income. These may include costs associated with establishing a website, motor vehicle expenses, diesel fuel usage, home office operations, travel expenses, and the use of machinery, tools, or computers. It’s imperative to maintain accurate records to substantiate these deductions. If you operate as a sole trader, leveraging tools like the ATO app’s myDeductions feature can assist in tracking business income and expenses throughout the year. Additionally, consider strategically writing off any outstanding debtors or depreciated assets before the end of the financial year to optimise tax deductions.Make sure your tax agent is registered.
3. Make sure your tax agent is registered
Ensure that your tax agent is registered with the Tax Practitioners Board (TPB) by verifying their registration through two primary methods:
- Utilise the TPB register to conduct a search and confirm their registration status.
- Look for the registered tax practitioner symbol on their official platforms such as their website, stationery, brochures, or business cards. This symbol denotes their registration type and individual registration number, providing assurance of their legitimacy.
4. Keep up to date with tax changes
Stay informed about potential tax changes each year, including alterations to tax laws and deductions or concessions for small businesses. Your tax professional can provide guidance on understanding these changes, or you can stay updated by subscribing to the ATO’s small business newsroom.
5. Review your finances
Spend some time reviewing your finances by yourself, or with your accountant or bookkeeper.
Look at whether you met your targets and what you can do differently next financial year.
6. Be wary of tax return scams
Small businesses are often targeted by various scams during tax season. These scams typically involve fraudulent claims regarding tax refunds or owed taxes. In tax refund scams, scammers deceive businesses by asserting that they are eligible for a refund due to overpaid taxes, but require payment of a fee for processing. Conversely, in tax owed scams, scammers falsely claim that businesses owe taxes and demand immediate payment, often requesting credit card details, money transfers, or purchases of iTunes cards as methods of payment. It’s important for small business owners to remain vigilant and cautious of such fraudulent activities.
7. Review your business and marketing plan
Allocate some time to prepare for the upcoming year. Consistently reviewing and refining your plans enables you to:
- Keep your goals and priorities in mind.
- Evaluate the effectiveness of your strategies.
- Adjust to any changes in your surroundings.
- Seize new opportunities as they arise.
- Optimise your efforts and focus on what matters most.
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 situation alters, it’s important to reassess your insurance coverage accordingly. Review the product disclosure statements (PDS) of your insurance policies thoroughly to avoid making assumptions about your coverage. A broker can collaborate with your business to secure the most advantageous terms from insurance providers.
Here are some additional factors to keep in mind:
Trust distribution resolutions need to be finalised before June 30, 2024 if your business operates through a trust structure. While it might seem like EOFY is distant, it will approach sooner than expected. Now is an ideal moment to get everything in order, accomplish your tasks, and realign your focus on effectively managing your business with assurance and precision.
If you require any assistance or guidance for EOFY preparations, feel free to contact us and schedule an obligation-free chat today at 1300 776 164 or send us an email at admin@kingsfordbookkeeping.com.au