Oh dear, the dreaded EOFY is here!
We believed many small business owners, entrepreneurs, and even freelancers have this “love-hate” relationship with the end of the financial year. Do you want to know why? Because it’s the season to mind tax returns, complete bookkeeping, and planning for the new financial year!
Pardon us for being this blunt, but we all know how tax time is not usually a fun time of the year. Imagine how stressful it is to chase invoice payments and expense receipts. Of course, with a reliable invoice maker, this scenario can be eliminated. Albeit the importance of these factors for small businesses, discussing taxes is a topic that many people would rather set aside— for good! But, we all know it’s not possible.
Surviving another financial year, with all the ups and downs, is a goal that most people in the industry could ever hope for. As the EOFY comes near, you should be reminded that this is the perfect time to review how your business progress. There could be things that you could have done better or perhaps the path you are going through is just the right one.
And so with no further ado, allow us to present to you these 5 things to do for the end of the financial year that will surely help you surpass EOFY and still save your sanity.
1. Take a step back and use this time to do an overview of your year.
As you reached the end of the financial year, this is also the perfect time to rewind or look back at what happened to your business during the entire year. The best way to do that is by reviewing your financial records. Now, if you keep organized records of all your financial transactions, congratulations, you are one-step ahead of passing EOFY with a breeze. Of course, it means you don’t have to stress yourself trawling through your bank statements, hacking up spreadsheets, and looking for lost receipts. We all know it is imperative for businesses to be organized, but let’s be honest here, some businesses fail to do this. That’s why the EOFY scares the hell out of them.
As you go through your financial records, remember your business’ goals and objectives. This will help you in assessing your business’ performance over the past year. Were you able to hit your targets? Do you still need further improvements? One step backward will give you two steps forward because it will help you in making a better plan for the next financial year.
2. Be smart, be intelligent and be tax-informed.
People are naturally scared of the unknown. For business owners, the mere mention of “taxes” can be intimidating, that’s why they shy away from it. That should not be the case! There are things about taxes that are worth knowing especially if it could help you minimize your tax. Yes, you read it right. Admit it, we caught your interest, so let’s talk about taxes, shall we?
You can minimize your total tax by the end of the year if you claim all allowable tax deductions. Going back to your financial records, check if you purchased tools, machinery, and other equipment. See also if your records have a motor vehicle and fuel expenses, home office costs, and travel expenses. Your business may be able to claim tax deductions for all of these.
Be advised though, that while there are tax deductions you can claim, there are also those you can’t claim. Remember to do your homework, incorrect claims, in addition to charging you for the tax amount you would have avoided are being penalized by the Australian Taxation Office (ATO).
Changes, as inevitable as it can be, are also applicable to taxes. You need to be updated on any new tax changes that might be applicable to your business.
3. Be vigilant on fraudulent tax refund schemes.
EOFY may be a busy and nerve-wracking season for most businesses, but do you know that there are people who are actually looking forward to that? These are evil people who plot fraudulent tax refund schemes!
There are two common tax schemes that you should be aware of. One, if you were informed that you overpaid your taxes and you can receive a refund, but only if you pay an administration or transfer fee. The second is when they tell you that you underpaid your taxes and you need to pay immediately by giving your credit card details.
This is why we highly suggest that you remain vigilant amidst the end of financial year. Know the people you are dealing with when it comes to your taxes and finances. Also, if you’ll follow our first and second tip, these schemes won’t work on you.
4. Take two steps forward. Things work out best for those who make the best of how things work out.
Why not, if it means getting your business up ahead? In order to do that, you would need to remind yourself about your goals and objectives. If you want to hit your target, find out if your current strategies are working or if you need to switch into new ones. In this digital era, businesses are expected to adapt easily even if it is a fast and ever-changing environment. If you are still using a spreadsheet, think again! EOFY could be the perfect time for your business to try expense app and other dedicated software suited for your business.
5. Breath in. Breath out. Move on.
Simply because you deserved it! The end of financial year is indeed a stressful one, but only for those who do not know how to manage it with a swag. We hope our five things to do for the end of financial year served as motivation for you to face each EOFY with a smile.
How do you deal with the end of the financial year? Do you have other handy-dandy tips we can add up? Feel free to share it on the comment section!
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