With one week to go before the end of the financial year, it’s time for small business owners to start gathering receipts and perhaps undertake some last minute activities to make the most of tax deductions this year.
Michael Kuster from Commercial Associates’ Penrith office said that the ATO is focusing on three main areas in relation to small business returns this year.
“The ATO will be paying special attention to non-compliance of super SGC payments for employees, business performance that falls outside small business industry benchmarks, and inconsistencies in activity statements or spikes in refund claims,” he said.
And while keeping piles of receipts or records of expenditure can be annoying, Mr Kuster said that by law your records must:
- explain all transactions
- be in writing (electronic or paper)
- be in English or in a form that can be easily converted
- be kept for five years (some records may need to be kept longer).
“If you don't keep the right tax records, you can incur penalties,” he said.
Mr Kuster also said there are steps small business owners who are facing a large increase in income can take now.
“They can make concessional super contributions up to their aged based limits, and they can take advantage of accelerated depreciation write-off for assets up to $20,000 acquired by small businesses with an aggregate annual turnover of less than $2 million,” he said.
Of course, planning throughout the year would avoid these last minutes rushes. Visit caaa.biz