EOFY: 3 Essential Points to Remember this Tax Time

And just like that, it is June again. In the flash of an eye another financial year is coming to an end. Most businesses currently have a million things to do leading up to the new financial year – 2020 budgets, review of operations, TAX, reviewing financials, TAX and did we say tax? Not only are businesses under the pump to get their ducks in a row by the end of June, their employees will be expecting that pesky little PAYG in their emails so they can make the most of those EOFY sales.

If you are feeling lost and stressed, have no fear! Before making any big decisions, make sure you consider the following:

How to treat pay rises this EOFY:

With the end of financial year, comes the influx in employees asking for pay rises. In a perfect world we want to shower our top performers in rewards. Don’t just jump the gun and sign that new contract. Make well thought out and profitable decisions for your business.

Can your business afford it?
Does their skill level, effort and hours of work accurately reflect their pay?
Does their pay align with industry averages?

Find that balance between keeping your best talent happy and keeping your business profitable. Think about whether you want to bring on any new talent in 2020. Reward but review first. Make sure you explain to your employee reasons why or why not for a pay rise and set expectations.

Record Keeping:

While this one may seem simple, it is still the biggest down fall for most small to medium business owners when tax and review time comes around. Record keeping can make your tax return hassle-free, keep track of your business activities and demonstrate your financial position. It is an essential task that helps make informed business decisions.

Go digital with your accounting – Myob, and Xero are two of many powerful options available in the market.

Store back ups of everything – every business should have a password secure computer system and back ups. Don’t create more stress by losing files due to computer crashes. Cloud storage may be an option for your business.

Check out our article on top tips when it comes to reporting.

The legal requirements for keeping business records

By law you must keep business records:

for a minimum of five years or longer after the record is created, updated or the transaction is completed (whichever is most recent)

in English or in a form the Australian Taxation Office (ATO) can understand.

Restructure:

For many small to medium business owners, the best time of the year to sit down and work on the business structure is May/June. It is the perfect time to properly review the business records and make those big decisions for the business. You may find yourself coming in either over or under budget. Look at every aspect of the business. What is and isn’t working. Think about growth, how you are going to achieve it and expectations from your employees.

It may be time to bring on new people and keep up a strong momentum of growth. Unfortunately for some it may be time to make some hard decisions and cuts for your business. Either way, having a streamlined, organised and systematic business will allow you to turn those hard decisions into informed decisions.

The business world is going digital – accounting software, cloud storage, employee hubs and more. Employee onboarding is another operation that can be easily streamlined with digital options. Being adaptable with your digital payroll options – myjoboffer is the software of choice for small to medium businesses. If you are reviewing your budget and operations for the next financial year, give us a call today and learn how you can simplify your HR processes and make your life easier next financial year.