The end of the financial year is almost upon us. How did that happen? Here are five things my fellow business banking specialists at the Greater Building Society and I recommend businesses look at before June 30.
1. Minimise tax
Look at what you can legitimately do to minimise the tax you will pay on this financial year’s earnings. Depending upon your financial position and how your revenue is assessed, you may wish to delay invoicing so the revenue doesn’t count this year. Look at prepaying business expenses or salaries to increase your allowable deductions. You may also benefit from writing off scrapped, obsolete stock and other assets. Consider bringing forward maintenance or other expenses to bring down your business income. Get your receipts and records for motor vehicle expenses and charity donations in order.
2. Contribute to Super
Speaking of tax, have you contributed to your own superannuation this year? Contributions up to $25,000 can be tax effective as they are taxed at 15 per cent rather than your marginal tax rate. (In 2013/14 the concessional cap is 35,000 for people aged 59 and over as at June 30, 2013.)
3. Pay your staff
Pay leave loading as unpaid accrued leave loading is not tax deductible. Did you know that if you created new jobs from July 1, 2013 and register those new employees with the Office of State Revenue you may be eligible for a $5,000 payroll tax rebate? Also, remember to prepare and issue group certificates to employees and the ATO on time.
4. Performance manage your suppliers
It is also a good time to review the performance of your key suppliers. Have you received value for money and the right level of service?
5. Review business and succession plans
Make the time to review business plans and succession plans too. Are you meeting your business targets and what key changes do you need to start making for next year? I will talk about succession planning more next month but you should always have an exit plan from your business.
See your accountant, business banker or business adviser for their advice on what needs to be done for your specific circumstances well before June 30.