Does this sound like you? You are aware that 30 June is coming soon. You are not too worried about gathering all the tax documents for your accountant because you know that you have until May next year to lodge your tax return. You may still be paying off the tax bill from last year, why the rush?
Despite the far away lodgement date, many business owners are on the back foot if they only choose to talk to their accountant once a year (after the financial year has ended). Here are 5 reason why it is important to see your accountant before 30 June.
1. To be aware of your tax position that year
Using various methods, your accountant can estimate your taxable income for the year. This gives you time to prepare for payment well ahead of the due date, knowing that you have time to put that cash aside and plan for other expenses for your business.
2. Discuss goals for the next 12 months.
This is a good time to chat to your accountant about your goals for the future. You may want to borrow money from the bank for your dream home, or you may want to exit your business in the next 5 years. The earlier the planning can start, the faster these goals can be achieved.
3. Implement strategies to legitimately reduce tax
If your goal is to pay less tax, many strategies need to be executed before the end of the financial year. For example, the June quarter superannuation needs to be paid and received by your employees’ super fund before 30 June for it to be tax deductible; if you purchased a truck for your business, it needs to be delivered to you before 30 June for it to be tax deductible. The list goes on.
4. Consider the best trading structure
Your income may have increased more than expected; you met a business partner who is interested to be working with you; your family is growing, and you are wondering if you need to protect them against your business. These are some of the reasons why someone might not be trading in the best structure possible. Chatting to your accountant before 30 June means that you could plan to start trading in the new structure on 1 July, giving the business a clean start for the financial year.
5. How the recent Federal Budget affects your business
The Federal Budget usually occurs in May each year. Many plans are announced on the day and you may not know how it affects your business. This is a good time to speak to your accountant to see if you can utilise any measures for your business.
If you want to be in control of your business, you should always see your accountant before 30 June. Business clients at Link Advisors meet with their advisors more than once a year. If you want an accountant who does more than lodging your tax returns, give us a call.