As the financial year’s finish line approaches, it’s common for businesses to feel stressed about handling taxes and ensuring they get off on the right foot for the upcoming year. In this article, we’ll provide four tips all business owners should pursue to end the financial year on a high, entering the next twelve months with clarity and confidence.   

  1. Prioritise Bookkeeping Accuracy

Bookkeeping isn’t always easy, and getting all the financial data required from your business to feel complete can take time. It’s good to set aside time to review the past twelve months’ financial records to ensure everything is accurate. Outsourcing can be a great way to achieve this, with an accounting service highlighting any errors or potential missing figures that may need additional evidence, such as the hours you’ve worked from home. 

Accurate bookkeeping ensures you pay the correct amount of tax, with your taxable income accounted for within the records and invoices you create and keep updated throughout the year. It’s best to have digital and paper copies of this data to ensure your business has accessible, accurate bookkeeping records.

  1. Check Deductions 

Generally, business owners can claim various expenses so long as they directly relate to their income; the expenditure was for your business, and you have a record of providing evidence of your claim.

For example, you may deduct vehicle expenses if you use your vehicle for business and have documentation to prove this. To better understand which deductions apply to your business, it’s best to contact an accountant to ensure you’re eligible for what you’re claiming. 

  1. Reflect on Your Yearly Reports

The financial year is an excellent opportunity to reflect on the past twelve months and your company’s financial position. Perhaps this year, you struggled to manage your taxes or didn’t efficiently record your deductions; your findings can be beneficial for guiding your business’s future financial decisions. 

The ATO calculates business taxes by subtracting your tax deductions from your assessable income, and the ultimate aim will be to identify various deductions to lower your income tax. So, as you enter the new year, prioritise accurately recording this information and identifying any missing deductions you can claim over the next tax year. 

  1. Revise New Legislation

With a new financial year comes new rules that your business must follow. There are a few notable changes to be mindful of. Let’s take a look:

  • The minimum wage will increase by 5.75% on July 1st, 2023, affecting business wages and taxes as we roll into the new financial year. 
  • The superannuation guarantee percentage also changes on July 1st, 2023, rising from 10.5% to 11%. With this rise, you’ll need to consider how much more money you’ll need to set aside for wages each payday and how this will affect your company’s financial status.
  • With the new changes to working from home hours, you must have reliable records that prove these hours occurred. You can use diary entries and timesheets as proof to secure the tax rate deduction of 0.67 cents per hour. 

Looking To Improve Your Business Bookkeeping Over The Next Financial Year? We Can Help 

At Advisory One, we have the accounting knowledge to support you in the new financial year. Contact us today to learn more.