Tax Time Tips

So you’re in business and tax time is fast approaching.

You’ve got 28 shoeboxes with receipts, invoices and more just waiting to be sent to your accountant or bookkeeper to process your financials. How much is it going to cost you given that your accountant or bookkeeper will have to spend hours sorting it out?

Save yourself some money – do some of the easy work yourself.

The accounting process can be broken down into 3 steps:

Sales
Purchases
Payroll

Find all of your sales invoices for the year and split them into two groups and into date order – Paid Invoices and Unpaid invoices.

Sort through your Unpaid Invoices and follow up your customer for payment. Remember – your cashflow depends on your customers paying you. You should pay close attention to who owes you what and when they will pay. Make a note if the invoice needs to be written off or a credit note applied. If you don’t know how to raise a credit or write off an invoice, you will have the notes for your bookkeeper to process this for you.

Next, find all of your purchases invoices and receipts and sort them into two groups and into date order – Paid Purchases and Unpaid Purchases.

Attach the relevant receipts to the Paid Invoices and then sort through your Unpaid Purchases and if possible, make payment prior to end of the financial year – any tax rebates applicable will then fall into the current financial year and will reduce your tax bill. Not sure if you can claim a purchase in particular? In Australia, contact the Australian Taxation Office to ask.

Lastly, find all of the payroll information and sort into date order. Payroll payments, tax paid, superannuation paid, deductions etc. Make sure that all of these statutory payments are up to date prior to the end of the financial year.

Compiling all of this information into date order not only makes it easier for your bookkeeper or accountant, but also means that you can identify any missing information. Providing all of your bank statements in date order will also make it easier to reconcile all incoming and outgoing monies.

It may be a lot of work and time on your behalf, but you can save money in the longer term.

Hope your tax time is stress free!

Cheers.

Jeremy
JPAP Bookkeeping