SHOP LOCAL: Five ways to prepare for tax time

SHOP LOCAL: Five ways to prepare for tax time

EVERY dollar counts when you are running a small business, so it pays to be organised.

With the end of the financial year fast approaching, it is important for you, as a small business owner, to stay on top of what you need to do when it comes to tax.

The tax financial year runs from July 1 to June 30.

Businesses are required to lodge an income tax return for this period and report other taxes such as GST and PAYG withholding.

Business owners are legally required to keep business records and documents for tax purposes for a period of up to five years, or they may face penalties.

This includes having to keep records even after you sell or close your business.

Helpful tips in the lead up to tax time:

  1.        Set aside time each week to maintain your business records.
  2.        Get your records ready and up-to-date. Keeping good records of your business transactions will help you monitor the financial performance of your business and make it easier when completing and lodging your tax returns.
  3.        Most expenses incurred in running a business can be claimed as a deduction, including operating expenses, business travel expenses, home-based business costs and costs associated with employing people. It is important to note however that these expenses must be business and not personal expenses.
  4.        Speak to your accountant about what tax concessions you are entitled to. Small businesses can claim a range of concessions including deductions for start-up costs such as professional, legal and accounting advice.
  5.        To avoid any late penalties, be sure to lodge your tax return on time. If you feel you are unable to meet this deadline, contact the Australian Tax Office (ATO) to request an extension.

The ATO has a range of tools and services to help small businesses manage their tax.

To find out more visit ato.gov.au or call them on 13 72 26.

The Small Business Development Corporation is here to help.

We have information about tax planning on our website.

Visit smallbusiness.wa.gov.au or speak to your accountant or tax agent.