The 2016-2017 financial year is coming to a close, which means you need to get your taxes in order. If you own a small business, this checklist will help you to cross those t's and dot those i's.
- Utilise the $20k tax break (if you haven't already)
- Prepare your records
- Check GST
- Check PSI eligibility
- Send your employees their tax returns
- Business activity statements, PAYG and GST paperwork
- Superannuation payments for employees
- TFN report
- Declare income
- Claim expenses
You still have a couple of days to take advantage of the $20,000 instant asset write-off for 2016-2017. If you qualify, your business can purchase any capital item costing less than $20,000 and immediately write-off the cost against your business tax bill. You can even purchase multiple items that cost $19,999 or under. Here are some ideas on what to buy.
Whether you're hiring a tax agent or going it alone online, it's important to have your tax records ready ahead of time. This includes cash, EFTPOS, credit/debit card and online sales records, as well as receipts for any expenses you plan to claim.
Are you claiming GST credits correctly? As outlined by the ATO, you can only claim a GST credit for goods or services used in your business. If you have goods or services you also use for personal purposes, you can only claim the business portion. For purchases over $82.50 including GST you will need to keep a tax invoice.
Use the ATO's Personal services income tool to determine if you earned Personal services income, and if the PSI rules apply to that income.
Have you compiled your employees' personal PAYG income tax returns yet? If not, you need to make this your top priority — these need to be sent those off no later than July 14.
You need to have made your Q4 quarterly superannuation guarantee payments to your employees' accounts no later than 28 July. (If you miss the deadline, you'll have to pay a super guarantee charge.)
You must lodge your Quarter 4 TFN report for closely held trusts by July 31. (But only if you have information to report.)
As with personal tax returns, you need to declare all income. Be sure to include gross receipts from sales and/or services, sales records (for accrual based taxpayers), returns and allowances and business checking/savings account interest. Here is the ATO's list of everything you must declare.
Claiming deductions is obviously very important if you want to maximise your cashflow for the year ahead. Expenses you may be able to claim include advertising, office equipment, travel expenses and business trips, commissions paid to subcontractors, depreciating assets, business insurance, interest expenses, rent expenses, maintenance/repairs and wages paid to employees. (Just like with personal income tax returns, you can only claim legitimate business expenses.)
The ATO has a dedicated guide for small business that will be able to assist you in this area. Good luck!
Remember - most of your business reporting can be done online. Head to the ATO website for more information.