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Tax office’s handy tips for small business

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July 06, 2017

The Australian Taxation Office says thousands of small businesses register every month, which means there are a lot of new business owners about to have their first tax time experience.

Assistant Commissioner Deborah Jenkins offers the following tips to small businesses, particularly those who are very new.

She said these five tips for small businesses to help you in the new financial year.

■Stay informed: There are a number of new measures that small businesses might be able to take advantage of this year. For example, the turnover threshold for a wide range of concessions has changed and there’s a lower company tax rate for small business.

It is a good idea to work out if your circumstances have changed and see whether you can benefit from the measures before you get into tax time.

The best way to keep up with what’s new for small business is to follow the Small Business Newsroom at ato.gov.au/sbnews.

■Get on top of your records: Good record keeping is essential for anyone in business because it makes it easier to manage your cash flow, meet your tax obligations and understand how your business is doing.

You can use your records to compare yourself against the ATO’s small business benchmarks and check how your business is performing against similar businesses in the same industry.

For more information and advice on good record keeping practice, visit ato.gov.au/electronicrecordkeeping and to find out how competitive your business is, use the small business benchmarks, visit ato.gov.au/businessbenchmarks.

■Find ways to make it easier: The ATO has a range of products and tools to make it easier for small businesses to stay on top of their tax and super obligations. For example, you can do most of your business reporting and transactions with the ATO online, so it’s a good idea to familiarise yourself with the ATO website to see where you can save yourself time.

If you are sole trader, you can lodge your returns using a registered tax agent or myTax. For the first time this year, sole traders can also use the myDeductions tool in the ATO app to keep track of your business expenses.

From 1 July 2017, goods and services tax (GST) reporting on the business activity statement (BAS) will be easier with Simpler BAS. Small businesses will be required to report less GST information, which will reduce the complexity of bookkeeping and reporting, saving you time and money. To find out more, visit ato.gov.au/simplerbas.

■Look after your employees: If you have staff, it’s important that you do the right thing by them by making sure you meet your deadlines for your employer obligations, including their payment summaries and superannuation guarantee payments.

You need to issue payment summaries to employees by July 14 and you need to lodge your PAYG withholding payment summary annual report to the ATO by August 14.

You should also make sure you know if your workers are employees or contractors because this can affect your obligations. There is a decision tool available online to help you get it right at ato.gov.au/ecinfo.

■Know where to get help: About 95 per cent of small businesses use a registered tax professional to lodge their returns, so it’s likely that your agent will be your first point of call (like those included in this feature).

You can also call the ATO and speak with someone over the phone because we’re here to help.

We’ve trained more than 4,000 staff to be able to assist small business owners who are dealing with difficult circumstances, including those who are managing mental health issues.

If you have a debt that you can’t pay on time, you might even be able to organise a payment plan online. For more information, visit ato.gov.au/debt or to find out about how the ATO can help, visit ato.gov.au/sbsupport.

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