Tax Time is upon us. For small businesses, this can be a stressful period. To ensure you successfully navigate this time of the year and avoid tax mistakes such as failure to report all your income, lack of necessary records to support expense claims, or claiming private expenses as business costs, we have listed a few key tips to follow.
Know what to claim
Distinguishing between what you can or cannot claim during tax time can be confusing.
This year the ATO has released newly developed fact sheets to help small businesses in claiming three of the most common types of expenses;
Assistant Commissioner of the ATO, Peter Holt, has encouraged both small businesses and tax practitioners with clients to make use of these fact sheets. “They have practical examples of how these rules apply to everyday small businesses – from home-based photography studios to someone who needs to travel quite a bit for their business. Our priority is to make it as easy as possible for small businesses to get it right,” he said.
Stay on top of your records
From simplifying the way you complete and lodge your tax returns, to managing cash flow, to meeting your tax obligations or more broadly understanding how your business is performing, good record keeping processes are key to making tax season an easier time for you.
You can use the myDeductions toll in the ATO app’ to keep records of your income and expenses. This can then be easily sent to us, your registered tax agent or uploaded directly into your tax return. You can also use the ATO’s record keeping evaluation tool to analyse how well you’re keeping business records.
For more information on how to improve your record keeping processes call us for advice. We work with a range of businesses spanning various industries and may just have that small change to provide a large impact on how you manage your records.
Be aware of your relevant concessions
Small businesses are also entitled to a range of tax concessions at tax time and this year the instant asset write-off has been increased and extended. This means that eligible small businesses can claim an immediate deduction for the business portion of their assets that cost less than the relevant threshold.
To see what concessions you may be able to access based on your turnover, call us or visit bit.ly/ATOConcessions
Let us help
When it comes to making the right changes and implementing better processes, we know tax time can feel like another hurdle, thrown into the busy juggling act that inevitably comes with being a small business operator.
We are here to lighten your workload and to offer tax advice year-round, should you need it. We also offer a range of handy resources, useful links and fact sheets, which you can find here: www.nexis.com.au/resources