A new financial year brings with it new opportunities and challenges, and members are reminded that accurate record-keeping should remain a priority. It is a key element of running a successful business – especially when it comes to tax time. Being on top of record-keeping ensures members always know the amount of money made and spent, as well as the business' cash flow position.
If members haven't already, now is a good time to review record-keeping processes. The Australian Taxation Office has released the below tips, in order to help business owners stay on track:
- Keep accurate records of all cash and electronic transactions (eliminates the risk of records fading and storage issues)
- Complete regular reconciliations of sales (both cash and EFTPOS) and enter the amounts into the main business accounting software system. Depending on your business, this may be daily, weekly or monthly
- Where business expenses have both business and private uses, work out and record the business portion accurately
- Ensure records are kept on file to substantiate business expenses claimed as tax deductions
- Don't use estimates to prepare tax returns and business activity statements (BAS)
- If cash flow is an issue, talk to a registered tax professional who can work through the ATO's cash flow coaching kit.
During these difficult times, it's important not to lose track of record-keeping. Complete and accurate records, kept up-to-date in real-time, can play a huge role in keeping businesses profitable and able to make smart decisions and plans for the future.
For more information
Australian Taxation Office: Record-keeping for business
Australian Taxation Office: Record-keeping evaluation tool