The Best EOFY Tips For Small Business Owners

The Best EOFY Tips For Small Business Owners

Top End of Financial Year Tax Tips | Aspect Accountants and Advisors

Tax time can feel quite daunting, especially if you own a small business in Perth. With this in mind, the team at Aspect Accountants and Advisors have put together the four ultimate tax time tips to help reduce tax bills, claim deductions, enhance revenue.

Pre-Paying Bills and Being On-Time

Before June 30

When claiming deductions, it is important to pre-pay expenses to gain what is known as a “quick win.” Expenses such as superannuation, subscriptions, leases, rent, phone bills, certain travel bills, motor vehicle servicing and internet usage should all be paid before the end of financial year.

After June 30

If possible, try to wait until after June 30 to send outstanding invoices. This will help delay having to pay tax on the income from those outstanding invoices until the next financial year. Just note however that this may not suit you clients/customers that would like to pay the invoices before the end of financial year.

Deductions

There are a number of deduction options that tend to be over-looked. This applies to both home-based small business owners and regular small business owners. We recommend engaging a good bookkeeper to help record business expenses throughout the financial year.

Deductions that are often over-looked include the following:

  1. Business-related bank fees
  2. Interest on business loans
  3. Charitable donations
  4. Software costs
  5. Franchise fees that do not involve an initial purchase

Home office deductions are also available and include the following:

  1. Office furniture
  2. Cleaning
  3. Repair work
  4. You can claim a portion of running expenses such as electricity, phone and internet.

The Aspect Accountants and Advisors team can also help you measure and determine what deductions you are eligible for. You can also visit the ATO website to check out their “Home office expenses calculator” here.

Assets and Stock

To reduce your tax bill, record your low- value assets. This will help to ensure they get depreciated at the appropriate rate in your income tax return. It is also advantageous to write-off any assets that no longer work.

Small businesses may be eligible to access the Government’s instant asset write-off of up to $30,000 this year which can deliver some instant tax savings.

Obsolete trading stock can also be written off and any closing stock should be recorded at June 30 at the lower of cost or market value to reduce tax.

Bad debts

Unfortunately bad debts are an inevitable component of running a small business from time to time. If you have any invoices you believe will not be recoverable from your clients/customers look to officially write them off before June 30 if all recovery actions have been unsuccessful to avoid paying tax on income you will not receive.

We hope these four tax time tips help make the process a little less daunting!

If you have any further questions regarding tax time, Aspect Accountants and Advisors in West Perth are here to help. Feel free to give us a call at our West Perth Accounting office.

P 08 9227 9400

F 08 6323 1111

E info@aspectaa.com.au

A 27 Cleaver Street, West Perth, WA 6005