At this point there are only a few weeks left to prepare your tax return for the 2024 EOFY.
Here are the things you need to do so you can minimise your business tax bill and streamline the tax time process.
EOFY TIPS 2024
1. Sort your paperwork
A successful EOFY tax experience is all about the paperwork and documentation you have ready. These days, it’s less about actual paper and more about the information you have on record, usually in the cloud with the help of your accounting system. However, if you have everything printed or in a folder, your tax accountant can still help.
The information to have ready will include:
- Incoming and outgoing sales records (invoices and receipts)
- GST related records
- Activity statements
- Employees’ superannuation contribution records
- Employees’ PAYG records
You will also want detailed records of any expenses that might be tax deductible. This includes things like equipment, tools and supplies, vehicle use and industry memberships. If it’s something like entertainment, which can be a grey area, show the receipt to your tax accountant and they can let you know if it counts as a work-related expense. It never hurts to ask.
2. Review your debts
Smart Company recently reported that late payments are creating big headaches for small businesses in Australia. According to a recent article, more than a quarter of Australian businesses said they lose up to $6,000 a year due to late payments, with 11% declaring losses of between $12,001 and $30,000.
If you’re in this boat, it’s possible to write off debts and mark them as money lost as a strategy to reduce your tax bill. However, you have to be able to prove you have attempted to reclaim the debt, so send out some follow ups to find out exactly what’s going on with the account.
Read more: Effective strategies to get paid faster
3. Finalise your employee’s superannuation contributions
It’s a smart idea to ensure your employee’s super contributions are all in order before tax time.
You are required to pay super at least every three months, and it’s in your best interest to get it done before EOFY 2024.
This is because you can’t claim for super contributions until after they have been paid. If you don’t already have your employees’ super payments worked out in the way that best suits you and them, now is the time to talk to your accountant to ensure it is ready before the end of June.
4. Pay in advance
The money you have in the bank at the end of the financial year is likely to be subject to tax. If you have some expenses coming up and some extra funds ready to pay for them, try to finalise the deal before June 30th so they can be claimed in the financial year.
You may be able to pay for a year’s worth of digital marketing expenses up front, or pay rent in advance as a way to take care of an inevitable expense while minimising your tax bill.
Tax changes in 2024
This year, there are not many changes that you need to be aware of as a small business for the 2024 EOFY.
The main one is stage three tax cuts. As a small business owner and an employer, you will need to make sure your payroll process is up to date to reflect new tax thresholds and ensure your staff’s take home pay reflects the incoming changes.
The other update that might affect your business is the small business skills and training boost. Your business may be eligible for an additional 20 per cent on top of the ordinary deduction for any external training you have paid for your team members between 29 March 2022 and 30 June 2024.
To see other changes, have a look at the ATO website and make sure to talk to your accountant.
Are you ready for EOFY 2024?
Paying tax is unavoidable but reviewing your accounts ahead of tax time is essential to find the best way to allocate funds and ensure you don’t pay too much tax.
Reach out to your tax accountant now to get prepared ahead of tax time and completing your 2024 EOFY statement will be so much easier.
Want to get ahead this tax time? Reach out to Mobbs & Company. We provide tax accounting services on the Sunshine Coast, in Caboolture and in Brisbane.
