Get your business ready for EOFY

11 tips to get your business EOFY ready

It’s that time of the year again, SMEs. It’s time to get ready for EOFY.

We know that as small business owners and sole traders, you’re doing your best to get tax time right. More than likely, you’re running a business because you have a passion, or you’ve discovered an opportunity.

But if you’re anything like the next small business owner, 30 June might feel like yet another hill to climb. And if you don’t understand your obligations too well, or if you haven’t kept the best records, the hill might suddenly feel like a mountain.

But don't worry, Bendigo Bank’s here to help. From tax and super to insurance, we’re talking 11 top tips about where to start and how to stay on track for EOFY.

1. Know where you’re at.

EOFY is the ideal time to review your business performance and set goals for the coming year. It’s also the right time to review your budget.

An accurate budget can give you the financial insights to make informed decisions. Look back and assess if your profit and spending aligned with this year’s budget.

2. Prepare your paperwork.

Get together your receipts and the business documents you need for tax time, including any bank statements.

It’s important to make time for record keeping. Well-kept records may save you some money in accounting fees and help ensure you don’t miss out on any tax deductions or GST claims. If you’re a sole trader and find you’re searching through old invoices, emails and receipts at tax time, consider using the ATO my Deductions tool to record your business income and expenses.

3. Write off bad debts. And make sure your debts are paid.

This could include invoices you’re still chasing from the last financial year. Bad debts are tax deductible and can be used to offset your taxable income. Cloud-based accounting software can help to send automated reminders to late paying customers (more about this technology later).

But as you check out who hasn’t paid you, make sure your own bills are accounted for. Finalise any last minute invoices while chasing down those late payers.

4. Know what you need to do, and by when.

Find out your income tax return lodgement due dates and the due date for payment of tax liabilities. If you expect a tax refund, you may consider lodging early. The ATO website lists key lodgement and payment dates to keep you on track. This will help you avoid ATO penalties for late submissions.

5. Know what you can deduct.

Make sure you’ve accounted for all spending to ensure you maximise your deductions. Small businesses can deduct the cost of carrying out business activities from your accessible income, reducing the tax you will pay. This might include supplies and services, or expenses like depreciation of business assets. Be sure to claw back as much money for your business. You should also know that businesses with a turnover of $2 million or less are eligible for a range of tax benefits. Check out the ATO website for more information.

6. Write ‘em off.

The Temporary Full Expensing (TFE) depreciation incentive replaced the instant asset write off from 6 October 2020. To be eligible for TFE, the business’ turnover threshold is $5 billion and there is no limit on the write off under TFE. Find out more about the scheme, check your eligibility and more on the ATO’s website.

7. Do a spring clean.

Explore how you can cut spending. This includes a health check of automatic expenses. Audit your business subscriptions to cancel any that you’re not using. Set up reminders so you stay across extra financial tasks you need to do in the coming year. For example, check if any of your domain names are expiring and set reminders to renew.

8. Explore cloud-based accounting software.

Now might be a good time to explore cloud-based accounting software if you’re not already. If you are, make sure you review the tools to check that it’s the right fit for your business. Also, check for software updates and new features to ensure you are using its full capability.

Consider a payment system that integrates your Point of Sale or Practice Management Software to reduce errors, simplify payments, and save time. Read more about integrated payments. Talk to us about setting up data feeds into your accounting package to streamline your operations and accounting in real-time.

9. Don’t forget about super.

As you know, the Superannuation Guarantee increased to 11 percent from 1 July 2023. It will continue to increase by 0.5 percent increments each year, meaning the amount of super paid to employees will increase. By 1 July 2025, the Super Guarantee will increase to 12 percent, so it’s important you keep this in mind as you plan ahead.

It’s a good idea to refresh yourself on your super obligations as an employer. Employer superannuation contributions for the quarter must be paid before 30 June for a deduction to be available in the 2021/22 year. You may also be eligible to make deductible personal super contributions. The Australian Government’s Super for employers page offers a convenient checklist and lots of other tools.

10. Check that you’re covered.

Changes to your business mean your insurance may also need to change. Maybe you’ve had a year of growth and opened new premises, or perhaps you’ve downsized your operations for more family time.

If your needs have changed, EOFY is a great time to review your insurance coverage to make sure you are heading into the new financial year with the right level of protection. There are many different types of insurance. It’s the ideal time to make sure you’re covered and ready to go for next financial year.

11. Get the right advice.

Not a tax pro? Not a problem. A qualified tax agent can help you make sure you’re meeting all your obligations. You can also subscribe to the ATO Small Business Newsroom to receive news, hints and notifications of upcoming dates.

And for anything else, the ATO’s Supporting your small business page offers tax time essentials, learning resources and tools to make tax time easier. You can also read more on The Australian Government’s business.gov.au - Taxation for your business page also provide information to prepare you for tax time.

And one bonus tip.

Save yourself the stress and get ready now for next 30 June. It’s the right time now to make a plan and stick to it. Set some financial year resolution, review your financial operations and set up some tools to streamline your processes for the new year.

Establishing systems and processes for the new financial year will set you up for success when EOFY rolls around again next year.