5 Ways To Make the Most of the End of Financial Year (EOFY)
The end of the financial year (EOFY) doesn't have to be all stress and preparation. Learn how you can also use this as a time to boost your business.
The end of the financial year can signal a time of stress for many business owners, but it’s also a time where you can grow your business and secure it for the future. Whilst you have to ensure that you’re meeting all the deadlines and requirements, there is always more that you can do to benefit your business in the meantime. This can extend from reframing your marketing to suit the mood of EOFY, to claiming the right tax offsets.
In this article, we’ll list 5 ways your business can make the most of the End of Financial Year (EOFY).
1. EOFY sales and promotions
Regardless of the types of products or services you offer, EOFY is a time to dispense with any extra stock by implementing promotional sales or promotions. Sales are an opportunity to accrue any last minute income whilst clearing the decks for the business year.
Similarly, it may also be a good time to make any business purchases, such as equipment or accessories. Many businesses also run events at this time to celebrate the end of another successful financial year. If you want to network with others in your industry or reach out to your customers, now is the perfect time to do it.
2. Know what the ATO is on the lookout for
Each year the ATO issues statements outlining the types of errors they are likely to scrutinise. Furthermore, key changes to tax policy will also be listed. Be sure to familiarise yourself with these to make sure you don’t get caught out.
In 2019, you can expect to see the ATO focus on the following tax errors:
- Not properly attributing personal and business use
- Omitting to report income, including coupon sales
- Not providing the proper records to substantiate expense claims
- Claiming private expenses as business expenses
- Not understanding how tax applies for different types of business
If you’re mindful of these and ensure you’re compliant with all of them, you can make sure your business minimises the risk of any misunderstandings with the ATO. If you’re unsure of whether you’re complying with your current obligations, it is worth consulting a taxation lawyer.
3. Keep accurate records
The maintenance of records is extremely important, not just for the purposes of compliance with Australian tax laws, but also because it benefits you as a business owner. The better your records, the easier it is to capitalise on any tax benefits you may be able to claim.
The ATO website provides information regarding recording keeping. The basic thing here to remember is to keep records of everything, and use a secure online system where you can access these documents at any time. For your legal documents, there are online platforms which allow you to customise and store all your documents. This means that you’ll be able to access them anytime, anywhere.
4. Capitalise on tax concessions
The end of the financial year is the perfect opportunity to utilise some of the benefits you may be eligible for. However, many business owners are unaware of all offsets that are actually available to them.
Here are some of the business tax concessions available:
- The instant asset write-off scheme
- Business-related deductions
- Capital Gains Tax (CGT) concessions
- Paying GST and PAYG in instalments
- Lower company tax rates
5. Plan for the coming financial year
June is also a time you can use to think about what you want your business to achieve in the 2019 – 2020 financial year. If you want to change business structures or increase your budget, now is a good time to start planning. For example, if you want to change your business from being a sole trader to a company, now is a good time to get your documents in order. Planning for the coming year may involve doing stocktake, upgrading your software or even changing your business strategy. Whichever way you plan, the end of the financial year is your opportunity to get organised and make resolutions for the next one.
Paul Taylor and Janette Nalbandian are both Legal Tech Interns at Lawpath as part of the Content Team. They are both Law students at Macquarie University.