Tax Preparation Checklist for Business Owners

Tax season is a time where business owners and accountants alike are making the necessary steps to comply with government taxation laws and its requirements.

It is a time where accumulated receipts, income records, documented claims, asset movements, liabilities, bank statements are all taken into account prior to the submission of tax returns.

Activities does spike under the process of filing tax returns and with time and experience, business owners have drawn up a simple checklist to summarise on what are the most important things to prepare during tax season:

Key ATO Requirements

Record-Keeping:
5-Year Rule: Maintain detailed records of income, expenses, assets, and liabilities for at least 5 years.
Types of Records: This includes bank statements, receipts, invoices, payment summaries, and contracts.

Business Structure:

Entity Type: Determine if you’re a sole trader, partnership, company, or trust. This impacts tax obligations.
Registration: Ensure you’re registered for GST if your turnover exceeds the threshold.

Lodging Deadlines:

Individual Returns: Typically due October 31st following the tax year (July 1st – June 30th).
Company Returns: Generally due by December 31st.

Payment Methods:

Direct Debit: Set up for automatic tax installment payments.
Online Banking: Pay via the ATO website.

Tax Types for Businesses

Income Tax: Tax on your business profits.
Goods and Services Tax (GST): Collected on sales and potentially refundable on expenses.
Fringe Benefits Tax (FBT): If you provide non-cash benefits to employees.
Pay-As-You-Go (PAYG) Withholding: Tax deducted from employee salaries.
Capital Gains Tax (CGT): Tax on profits from selling assets.

Checklist for Tax Time

As a general rule of thumb, the following simplified checklist are to be compiled during tax time season:

Gather Financial Records: Collect all receipts, invoices, bank statements, and payment summaries.
Calculate Income and Expenses: Determine your total income and eligible deductions.
Check for Entitlements: Research potential tax offsets and deductions.
Capital Gains/Losses: Review any asset sales and potential CGT implications.
Superannuation Contributions: Ensure compliance with superannuation guarantee obligations.
Pre-Fill Information: Review the ATO’s pre-filled data for accuracy.
Lodging: File your return online or with a registered tax agent.

Additional Things to Keep in Mind

Tax Agent: Consider hiring a registered tax agent for professional advice and assistance.
ATO Resources: Utilize the ATO’s website and tools for guidance.
Stay Organized: Maintain good financial records throughout the year.

NOAC Consultants is a trusted Accounting Services provider based in Coburg, Melbourne. The company is comprised of senior accountants and financial analysts to provide a dedicated accounting solutions to small businesses and small corporations.