5 Essential End of Financial Year (EOFY) Accounting To Dos for Business Owners
The end of financial year can get hectic for business owners. It’s stressful trying to ensure that everything is in order and that you haven’t missed anything. To help you along we have created a list of 5 to dos for the EOFY.
1. Get organised
The first step to any end of financial year is organisation. Everything should be nicely organised throughout the year to save you from any extra work, but, if that doesn’t sound like you then all is not lost. Make a start – the sooner you start, the sooner you will be on track going forward. Use a tool Like Receipt Bank to allow you to electronically capture all your business expense invoices either by email, mobile phone app or web. Keep other important information for each year in cloud storage (like Google Drive or Microsoft One Drive) - you probably already have access to these apps for free as part of your email subscription, so why not make the most of them. You can then share these documents with your accountant come year end. By ensuring that you are organised for the EOFY you will be able to spend more time on more enjoyable parts of your business.
2. If you have employees, Ensure you are ready for Single Touch Payroll (STP)
From 1 July 2019, all businesses with employees will be required to report payroll data to the ATO each pay cycle. This is called Single Touch Payroll (STP). If you are using a modern accounting/payroll system like Xero or Keypay this won’t be a daunting task. All you need to do is connect the software to the ATO using the instructions provided by your software provider. Be sure to do this before 1 July 2019 so you are ready to go (some larger businesses will have already been required to be registered from 1 July 2018). If you aren’t using Xero or Keypay (or a similar modern payroll solution), you should speak to your accountant and ask what you need to do to become compliant.
3. Find out what deductions you can claim
By finding out what deductions you can claim you will be able to maximise your deductions, putting more money back in your business’ pocket. There are some simple things that your business can claim a deduction on, such as if your business has set up a website, has motor vehicle expenses, operates at home, has travel expenses and more. If you really want to make the most out of your tax returns and get the highest deductions possible you should speak to an accountant.
4. Get ready for the next financial year
Once you have lodged this year’s tax it is now time to prepare for next financial year. Tax laws change so its important to be aware of any new rules which apply to your business – some new rules can have a positive impact with you can take advantage of, some may not be positive and will require planning and strategy to reduce their impact. This is also the perfect time to review all your processes from record keeping to marketing, ensuring that your strategies remain appropriate and effective. Reassess your goals, ensure they are suitable for your current position and for where you want your business to be. The new financial year is also a great time to look at implementing a new accounting system like Xero.
5. Build a relationship with a great accountant
A great accountant will turn your stressful EOFY into something far more manageable. They will help you understand what the year looks like even before its finished and help keep you on track with your compliance and record keeping obligations. They will also make sure your business is structured appropriately and you aren't paying more tax than you should be. Having that relationship with a great accountant means you have someone to ask when you need an answer to a business or tax question. Talk to an expert accountant today and see how they can help your business.
If you need more EOFY advice contact Link Advisors today.