By Marilyn Breen
Here are some tips to help you get your affairs in order and start the new financial year in the best position possible.
- Be aware of relevant tax changes – a number of tax changes will be introduced at the start of July and you should consider the impact these may have on your cash flow position. For example, the Medicare levy will increase from 1.5% to 2.0% of taxable income and the new 2.0% Temporary Budget Repair levy will come into effect.
- Get your tax-deductible expenses in order – an easy way for small businesses to claim tax deductions is to pre-pay relevant services and supplies such as office supplies, up to a period of 12 months or less. By bringing forward tax deductible expenses and deferring income, you can reduce your taxable income for the financial year.
- Be aware of all applicable tax benefits – a business with a turnover of less than $2M is eligible for a wide range of tax benefits such as Capital Gains Tax, Income Tax, Fringe Benefit Tax.
- Make sure your debtors are up-to-date
- Prepare a cash flow budget for the new financial year
- Review your prices based on your fixed and operating cost forecasts
- Review your insurances and other fixed costs – make sure you have the appropriate level of insurance cover for your business and research whether there are more competitive policies in the market that could potentially save you money.
- Map out your advertising and marketing budget and calendar based on results from last year
It’s important to prepare your tax and end of year accounts early so you can identify your profit/loss and determine how well your business has performed.
Finally, the more organised you are in finalising your annual accounts and planning for the new financial year, the greater opportunity you have to maximise your earnings.