Ideally, you should start planning around the last quarter of your tax year which is between April and June. However, as there are several tax strategies that you can implement that can benefit your business, we like to say that it’s never too early to start planning. Tax planning is an annual account of all the financial aspects of your business. As there are several areas to take into account like timing of purchases, planned big expenditures, investments and Superannuation contributions. For effective tax strategies to work, implementing them throughout the tax year makes it easier to submit and improves your chances of a greater return or minimising your tax payable.

Goods and Services Tax (GST) is a 10% charge on taxable goods which include most goods, services and items sold or consumed within Australia. This tax is only applicable if your business has an annual turnover of $75,000 or if your business is a non-for profit organisation with an annual turnover of $150,000. Alternatively, if you’ve just started your business and project your turnover to reach the threshold within the first year of operation, you can register. You can also voluntary register for GST, even if you don’t reach the GST income threshold of $75,000.

Superannuation is money that an employer pays employees to provide for their retirement. These contributions are calculated with every pay period (the minimum rate of 9.5%) but are only paid into the employee’s respective super accounts once per quarter (four times a year). Employers should be making super contributions from the day the employee starts at their organisation/ business until the day they leave or retire. These contributions do not affect the employee’s monthly take home salary unless in a salary sacrifice arrangement.

A bookkeeper captures your business financials whereas an accountant analyses, reports and summarizes your financial state to implement tax strategies and systems for cash flow, tax, stock take and other responsibilities, while also keeping your business financial health in check. In accounting, there are two qualifications: A Chartered Accountant (CA), who are fully qualified and recognised internationally and a Certified Practicing Accountant (CPA). All COADS employees are Chartered Accountants which means that we’re able to analyse your financial records and forecast the most ideal tax strategies for your business. We’re also able to process Superannuation Funds, and give advice on Estate Planning and Property Tax as well as offer a range of other business and taxation services.

First you need to record all of your income you received during the year and record of all your tax deductible expenses. Source documentation that you should keep are income invoices as well as receipts/invoices for purchases made. You should organise your records into categories such as payments you’ve received; expenses related to payments you’ve paid, asset acquisition or disposal documents if you hold, buy and sell shares. We recommend following the ATO guidelines of holding your records for at least a minimum period of five years and preferably in a electronic format.

You are legally required to keep any detailed expense information that relates to your business & tax affairs for up to 5 years. This includes when you started the business, running, changing, selling and closing the business such as: Receipts, evidence of sales and purchases made for the business, tax invoices, wage and salary records and all documents regarding goods and services tax (GST). The ATO at any point can ask to review/audit your records so it’s important to keep everything in an efficient system, that protects all your documents from damage and being lost. Cloud accounting software is highly recommended such as XERO

A business or organizational structure is the type of entity you want to own and that determines how it should be run with regards to legalities, amount of tax you pay, responsibilities, procedures, & asset protection. There are four main business structures namely sole trader, partnership, company, and Trusts. The structure of your business can affect certain areas such as legal compliance, tax to pay and entitlements to discount on capital gains tax. Your ideal business structure is determined by your individual income/wage levels, business profit levels, assets you own, risk of being sued, and family members/beneficiaries income levels.

Capital Gains Tax is applicable when you sell an asset, such as property and shares. The gain is the difference between what you paid and what you received. This is known as the Gross Capital Gain. If you have held your asset for more than 12 months you are entitled to a further 50% Capital Gains Discount. However, if you have capital losses you can offset these losses against your gain. Your capital gains tax is calculated by first determining your cost base (the amount you paid for the property or asset in question) and the cost of acquiring the asset. This amount comprises the cost of transfer, stamp duty, loan application, any advertising conducted, termination and valuation fees and any professional services used in the process such as conveyancers, brokers, agents etc.

By implementing a series of tax planning strategies which include bringing forward and pre-paying regular business expenses, delaying your invoices until after the 30th June, utilisising a low superannuation tax environment by contributing personal super contributions (be mindful of the contributions caps), write off certain assets for the instant asset write-off (See limits) and reviewing and writing off bad debts before the 30th June. You can also apply small business capital gains tax concessions and closely monitor and review your current stock to see if any of it can be written off. For businesses or individuals that are invested in properties, Capital Gains Tax (CGT) or other Property Tax strategies can also be applied.

Yes. Regardless of which software you’re using, an accountant oversees and checks your tax return/financials to ensure that it’s filed correctly and that you can benefit the most from it, in line with the law. Having an accountant is especially ideal for more complex business structures like companies, trusts as there is plenty of tax planning strategies to take advantage of and implement. Tax returns require detailed knowledge. While this information might be available online, it takes time to understand the finer details overall. By choosing a qualified Chartered Accountant, not only will you have accurate financials and potentially promising tax returns but you’ll also gain insight into effective tax strategies, business management, inventory management and other aspects that can benefit your business.