Small Business Tax Planning Tips: The Do’s And Don’ts
Small Business Tax Planning Tips: the Do’s and Don’ts
Tax time can be daunting, especially for a small business owner who is lodging a tax for the first time. To add to your stress, the Australian Taxation Office penalises taxpayers for having errors or inaccurate records in their tax reports.
To avoid being audited and paying hefty fines, focus on recording your day-to-day transactions involved in running your business that can help in making end of financial year (EOFY) tax planning stress-free.
To ease your tax burden, we have compiled some easy tax planning tips for small businesses that will surely work for you.
- Consider Regular Record Keeping
Maintaining transaction records around the year makes a great difference when preparing taxes.
No matter how many daily transactions you do, record keeping is an essential practice that eases your accounting and taxation worries to a great extent.
When preparing end of the financial year reports, hire professional tax accountants to help you out.
- Track Expenses To Maximise Tax Deductions
To maximise your tax deductions and reduce liabilities when filing tax returns, it is important to track your expenses and have a written record of debts and assets, so you won’t have to end up doing hefty calculations when needed. Also, consider writing off the following:
- Non-recoverable debts
- Obsolete stocks
- Depreciating assets
- Commercial rent
- Business travel expenses
- Never Overlook Tax Due Dates
Small business owners often overlook their tax due dates and struggle to meet their tax obligations because of other growth priorities and workloads.
However, it’s really important to follow the due dates to avoid any penalties and interest. Also, constant non-compliance may flag your business for a detailed audit by the Australian Tax Office.
You can hire the services of a qualified accountant to understand your tax obligations.
- Don’t Maintain Partial Financial Records
Partial record keeping can lead to inaccurate and unreliable tax lodgement that can be a cause of concern and lead to tax office audits. To craft an accurate financial position for a business, consider the following:
- Lock all accounts relating to the financial year
- Make an easy transition into the new financial year
- Create a separate copy of the accounts and back it up
Don’t ignore the importance of investing in expert assistance when it comes to small business tax planning in Australia.
KPG Taxation is your local accounting firm helping individuals, sole traders,and businesses in managing their finances and preparing tax files.
Focus On Growing Your Business, Leave The Accounting On Us!
- Income Tax : File your taxes & get the best claims & returns.
- Accountancy : Hire expert accountants to manage your transactions.
- Bookkeeping : Let us handle your record books and expense reports.
- Business Advisory : From company set-up to payroll, we handle it all.