The Ultimate To-Do List to Ease your EOFY Accounting
The Australian End of Financial Year (EOFY) is coming up. It’s a busy time, especially for accountants, bookkeepers and businesses. There’s a lot to organise so that taxes can be properly filed and paid.
However, while there is the same deadline every year, most businesses put off dealing with the accounting until the last minutes. We’ve been working with Perth businesses for years, so here are a few things to help make your end of financial year easier.
Pay all Superannuation NOW
Handle your superannuation contributions as early as possible. This will save you having to pay penalties.
If you’re new to this, it can be confusing and complex so either start early or get expert help. Doing this properly can take time and skill. You need to collect accurate employee information, calculate contributes and pay super as needed before EOFY.
Audit your Account Receivables (A/Rs)
Account receivables are the money owed to your company. If you mismanage them, it can impact your business’s finances. Keep them current and chase down late invoices and you’ll do better.
Two weeks before EOFY, check who and what is owed to you. Do you have to chase anyone down or write off debts? You need to have your A/Rs up-to-date or you may accidentally overpay on your taxes. You can write off unpaid invoices over 12 months old and deduct the loss from your taxes.
Organise your Bills
Organising your bills is a prerequisite to EOFY business reporting. Unreported bills and expenses will mess with your income statement and incorrectly hike up your income, which could in higher income taxes.
Are you paying your bills on time? Being a good payor will help you succeed as business will give you better and faster service. It will also save on delay fees and interest. If you have recurring bills, set up auto-payments and prepay bills where possible. It will save you time and effort.
Stock levels are different for every business, and there is no specific formula to follow when calculating your stock levels. A new business will take some time to establish accurate stock reporting and forecasting. All this hard work means less storage costs, more new stock, and less chance of running out of stock.
In the lead up to the end of the financial year, you should do a stocktake. This will help you to reassess your stocking procedures and write-off lost, damaged or outdated stock – decreasing the amount of tax you will need to pay.
Book your Accountant
Getting expert help is incredibly important not only as a sound business strategy, but also as a way of freeing you to do what you do best – grow your business.
A professional can ensure top-quality output, save you from significant errors and the costs that come with them. We are here to support you in reviewing your accounts and determining your tax position. Make sure to book your accountant early on so that we can help you continue on your journey to build a thriving and success business.
Assess Depreciable Assets
Look at all of your assets to make sure you know their worth. Assets like equipment, property and vehicles can lose its value from wear and tear, break downs and accidents. Is everything in working order? Are they costing more than they should to maintain or use? Doing this can help you lower your taxes.
Equipment you’ve purchased and have delivered this year is eligible for a tax deduction.
Review Income Protection Insurance
Running a business comes with risk. They may be calculated and managed, but you need to protect yourself in case something happens. EOFY is a good time to check your income protection and update anything that needs updating.
Stock up on Office Supplies
Tax time is crunch time. You shouldn't have to waste time running out of paper or toner. Stock up on suppliers before you begin your accounting and reporting.
Take advantage of bulk purchasing. It will save you on costs and it will simplify your purchasing process and eliminate hassles caused by office supplies stockouts.
Plan for your Retirement
You need to make sure you pay yourself first. If you are going to take care of your business, you need to take care of yourself. This includes having a retirement plan that works for you.
Talk to a financial planner. They can give you expert advice on investing and insuring your future. They can also do an EOFY review of your finances to calculate the best tax-deductive superannuation contributions. It can optimise your savings without impacting your business.
For your convenience, should you require broader advice around superannuation, our in-house superannuation accountant, Romana Pears is licensed to support you.