As the end of the financial year approaches Australians everywhere scramble to get their taxes in order. Tax time can be an especially stressful time, but there is added pressure when your run your own small business. Obviously, you want to be making sure you follow all of the legalities, whilst simultaneously maximising your money you get back.
If you’re finding tax time a little tricky, here are our top five tips to help you out:
- Get some help
There’s no shame in asking for help. Especially with something as important as taxes. In order to make sure your tax is working the best it can for you, it can be helpful to get some outside help from a business tax advisor.
A business tax advisor will take all of the guesswork out of your tax and be able to maximise the money that goes back into your pocket. Plus, their expertise will help you identify areas for additional deductions and take the pain out of paperwork.
- Get your paperwork in order
Small business accounting is integral to running a successful business, so these records should be current and accurate at all times, but especially during tax time. Making sure all of your paperwork is correct and up-to-date, is one of the simplest ways to make the end of financial year easier, as all of your relevant documentation will be easily accessible.
This will make your life so much easier, as your will have proof of all of your expenses and profits and will help you protect yourself and your business in the case of an audit. Plus, if you did hire a business tax advisor it will enable to do their job with so much more efficiency.
- Claim start-up costs
If you started your business within the last financial year, you are able to claim back a number of items at tax time.
These items include meetings with accountants and lawyers you made to gain advice on how to start your business. Additional deductibles include government fees and fees on borrowing. Plus, bank fees and interest can also be claimed back.
- Claim assets
One of the benefits of running a small business is the small business tax break including the deduction of assets.
If your business makes an aggregate annual turnover of $10 million or less, assets purchased can be deducted up to a value of $20,000. Plus, you can deduct as many assets as you want, as long as you purchased them throughout the financial year, are under the $20,000 limit and ready for use prior to 30 June.
- Write off or pay off bad debts
Writing off (or better yet paying off) bad debts can help reduce your tax liability. When you write off bad debts, you may become eligible for a GST credit or a tax deduction making your tax time that much better.
If all of these tips proved to cause more confusion than help, consider getting the assistance of a business tax advisor. It is the job of a business tax advisor to help businesses to get the most back on their tax, and their expertise will prove to be invaluable.