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Are you on top of your EOFY tax affairs?
Wednesday, 6th August, 2014, by Channa Perera
In today's Smart Tax Bulletin:
- What you must do to be on top of your EOFY tax affairs
Dear Reader,
As I promised last week, this week’s bulletin will cover what all small-business owners need to do to ensure they are on top of their end of financial year tax affairs.
The first step is to ensure that all of your financials have been reconciled and are accurate. You can do this by:
- reconciling your receivables;
- reviewing your inventory;
- bringing forward your tax-deductible expenses;
- reviewing your superannuation obligations; and
- planning for the future.
Continues below…
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Reconcile your receivables
To reconcile your receivables, you will need to chase down any outstanding payments from your customers.
If there are any debts you can’t recover and can write off as bad debts, you will be able to claim a tax deduction for them.
Review your inventory
Consider your inventory to see whether you can write off or write down the value of any stock.
The value of the inventory that you hope to write down can be included in your tax return. This will reduce the amount of tax you have to pay.
Bring forward your tax-deductible expenses
A good strategy for business owners is to pre-pay for services and supplies in order to claim a tax deduction.
Bringing forward tax-deductible expenses and deferring income can work to reduce your taxable income for the financial year.
Review your superannuation obligations
Make sure you are on top of all your superannuation obligations. You will receive a tax deduction for all employee superannuation payments you make.
As super is such a tax-effective way to invest, you may also want to look at investing your personal assets in super.
Plan for the future
The end of a financial year is also the ideal time to plan for the future. Develop realistic profit and loss forecasts for the next 12 months, and set business goals for the next 5 or 10 years.
Once you’re on top of these things, you can work through the relevant regulatory requirements, such as completing your business activity statement (BAS) and providing group certificates to your employees.
I’ll take you through these requirements in next week’s bulletin.
Until then,
Channa Perera
Editor
Smart Tax Bulletin
Editor
Smart Tax Bulletin
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