The end of the financial year doesn’t have to be a scramble to collect the information you need to fulfil your obligations to the Australian Taxation Office (ATO). For business owners, this time of year can be very stressful if you fail to prepare correctly. However, if you do take steps to gather the information you need for your end of the year reports in advance, the entire process of submitting your information will be much easier. Being organised throughout the year and having a proactive approach to EOFY is key to ensuring you are ready when the June 30th deadline arrives.
Creating a checklist is one of the best ways to make sure you are ready for the end of the financial year. Knowing what you need to do and having a plan in place will allow you to complete everything that you need to do with ease. Creating a checklist will help you to stay organised and on track to ensure that all of you complete everything that is required of you on time.
Continue reading to learn how you can create an EOFY checklist so that you are ready and organised at the end of the financial year.
Organise Ahead Of Time
Being organised is key, in not only creating a checklist for EOFY but also in executing what you include on your list. Whether relying on hard copy documents or electronic files, having an organised filing system in place that clearly labels your business reports is crucial. You need to ensure that you can find the documents and reports that you need as the end of the financial year approaches. Keeping all of your business information organised throughout the year will allow you to relax in the run-up to June 30th, knowing that you have all the information you need.
Prepare Your Tax Records
At the end of the financial year, business owners are required to submit records of all of their financial activity. You need to ensure that you explain exactly how your income and expenditure figures were calculated and provide documentation to support these calculations. It’s also important to include information regarding any claims that you may have made in terms of your tax returns. The information you submit to the ATO should include tax records related to income, GST and income tax records. Also, be sure to include information related to employee payments, including PAYG reports and superannuation payments.
Conduct A Stocktake
Before the end of the year, businesses must conduct a stocktake of all inventory or stock that they own. Carrying out a stocktake can take some time but it is a crucial task at the end of the financial year. However, not every business needs to complete a stocktake. If your business turnover is $10 million or more, you will be required to complete a stocktake. Also, any business that has a turnover of less than $10 million but the difference in stock levels from the start of the year to the end of the year is more than $5,000, you will also need to conduct a stocktake.
Assess Your Deductions
At the end of the financial year, you can claim for certain tax deductions. However, it’s important to understand what deductions you might be able to claim so that you know what your options are before the June 30th deadline. Generally speaking, you can claim a deduction for expenses that you incurred as a result of running your business. Your claims must be directly related to how you earn your income. For example, travel costs, motor vehicle expenses, repairs and maintenance, costs associated with running a business from home and general business expenses such as internet fees, office supplies, insurance and salaries, can all be tax-deductible. However, the ATO has rules and regulations in place regarding what you can and can’t claim for and it’s important to follow their guidelines to ensure you enter your claims correctly.
Plan For The Year Ahead
The end of the financial year is a time for reflection and analysis of the year gone by. This is the time to look back on the previous year and see where you can make changes to ensure that the upcoming year will be even better. With the data you collect for your end of the year reports, you will have an accurate picture of the financial health of your company. Armed with this information, you can make changes to your business plan, streamline your business processes, cut back on unnecessary expenses going forward and set yourself up for a successful year ahead.