The end of the financial year (EOFY) is coming on the 30th of June and everyone is trying to figure out where the time went, it's flown by! This period can be an extremely stressful time for business owners and operators.
DISCLAIMER: All information was correct at the time of publishing. We are not professional accountants, so please make sure to get in touch with experienced and registered accountants or tax agents to help you with your business's circumstances.
With many things to get sorted before the EOFY, it's a good idea to get on top of it and start planning ahead. That's why we’ve put together a list to help you prepare and take a load off your shoulders:
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The EOFY is a good time to reflect on the financial year that has been and plan for the future, looking for opportunities and strategies to implement in your business. Review your goals, track your progress and set new goals. Ask yourself these questions:
Has this year been profitable?
Are you ahead in terms of tax planning?
How are your staff going?
What does your future look like?
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At tax time you can claim deductions on many business expenses, just make sure you keep records of these transactions for when it's time to claim them. Here's a list of write-offs that your business may be eligible for:
Wages
Cash registers/POS systems
Computers and laptops
Security systems
Insurances
Rent
Power/gas
Furniture
Laundry/cleaning
Marketing costs
Website/subscription fees
Donations
The depreciating value of any goods you own
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Instant Asset Write-off
A big tax break for small hospitality businesses is the instant asset write-off. This eligibility was expanded in 2020 as an effort to push business investments during the pandemic and has been extended until 2023. This applies to businesses that have an aggregated annual turnover of less than $500 million.
This is highly attractive to hospitality operators as they can claim this deduction straight away. To find out if you're eligible check out the ATO for more details.
Staff Training
A 20% additional deduction is eligible for training courses helping businesses upskill and better train their staff. The course participants must engage online or in-person in Australia through external education providers who are registered in Australia.
This tax back is eligible for small businesses with an aggregated annual turnover of less than $50 million.
Technology
It has been announced there is a new 20% additional tax deduction for business expenses and depreciating assets that support digital workplace items. This tax back is eligible for small businesses with an aggregated annual turnover of less than $50 million.
These expenses include:
Portable payment devices
Cyber security systems
Subscriptions to cloud-based services
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Many businesses hold sales in the lead up to the EOFY period, so why not make the most of them. It provides a good opportunity for businesses to take advantage of these sales and invest in products/services that they need. It would also be worth stocking up on anticipated items that will be used throughout the coming year and saving some cash by buying them at a discounted rate.
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It’s important not only to be thinking about your business and what needs to be done at tax time but also to think about your staff. We all know how hard it has been recently in the hospitality industry to find staff and retain them. With the stress that comes from hospitality work, take a load off your employees around tax time and provide them with useful resources.
Staff can claim various work-related costs at tax time. The ATO website is a great resource to provide them with in order to help understand what they can claim back on tax. Hopefully walking away with some extra cash in their pockets.
Many work-related expenses can be claimed by hospitality staff such as:
Clothing/laundry costs
Car expenses
Self-education such as courses
Tools and equipment
It’s important to keep your staff happy as this results in higher staff retention and makes finding new staff less of a nightmare for you. Creating a happy and safe workplace can also be seen reflected in your employee's work - resulting in better customer service!
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Knowledge is power, running a business is time-consuming and the hours are rigorous so it's not always possible to take on every task yourself. It is important to acknowledge when you need help.
Talk to experts in their fields, and get advice from financial experts on what you should and shouldn't be doing, you don't need to be alone taking on the tax burden. Talk to your account, or better yet make friends with them so they can better understand exactly what your business needs and provide you with the best advice.
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Accounting software integrations can be a god-sent at tax time, saving you valuable time and money. The setup of these integrations is easy and can take a huge weight off your shoulders.
If you haven't had the time to integrate this financial year, now is as good time as ever to integrate and be prepared for the next financial year. OrderMate recommend the following accounting software to integration with your POS system:
Xero
Xero is a great accounting integration. It's a world-leading online accounting software built for small businesses.
Reducing manual data entry processes
Eliminates human error
Saves you time, so you can focus on what you do best
What's so great about Xero is all you have to do is enter your business details and then you can get started. They provide you with a real-time view of your cash flow and the ability to view this information anywhere through its mobile app.
MYOB
MYOB offers more than 50 business management solutions to support you with accounting, payroll, payments, retail point of sale, CRM and professional tax solutions. It allows you to run your business on a more efficient level saving you time by allowing you to import and export the sales and data.
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Performing a regular stocktake is an important aspect of any hospitality business. Keep an eye on the stock you have at hand and what needs to be ordered. Through performing a stocktake you're able to identify what has been selling well and what hasn't.
Advantages of stocktake:
A better understanding of your stock levels and what you have.
Assure you don't have too much or little stock.
Identifying what you need to buy.
Help your cash flow by understanding what stock is slow-moving and reducing it.
Reduces risks of spoilage.
Identify if any stock has been stolen.
Allows you to review your pricing strategy.
Creating specials with items that may not be selling as you expected is a good idea to help manage your slow-moving stock without letting it go to waste. For example, a wine that's been sitting in your stock room for a while could be the included drink in the EOFY package or given away as a complimentary drink at the EOFY function.
From the team at 21st Century Business Equipment, we wish you all the best this end of financial year!