Running a business is hard enough, but small business taxes? That's a whole other headache. Learn how to file taxes stress-free here.
Would you like to learn more about small business taxes in Australia? You’ll find hidden and often overlooked details in those laws if you know where to look. And it’s those hidden gems that might change the way you do business.
Read on to discover the most critical tax laws for small businesses, so you can avoid penalties and increase your bottom line this year.
Federal Tax Authority
The Australian Taxation Office (ATO) oversees the collection of federal taxes. These include income taxes, capital gains taxes, and goods and services taxes. They also set the federal tax rates.
They also offer tax toolkits and other support for small business tax preparation. Outside of the ATO, each Australian state and territory also has an oversight committee. Check with your local state or territory to discuss their small business tax filing system and small business tax form, as each is slightly different.
International Small Business Taxes
If you run an international business, you have a few additional things to think about besides bookkeeping tips.
This is where the bulk of your taxes will come from. Direct taxes are those paid by a taxpayer to the Australian government as opposed to indirect taxes which can be transferred to other parties, such as consumers.
Corporate income tax: this general income tax runs at 30% though some folks may qualify for small business tax credit and reduced rates. The system is usually set up in a pay as you go, or quarterly plan.
Capital gains tax: this comes from the discarding of capital assets, though foreigners are usually taxed only on physical property. A net loss in this category can carry forward to offset future gains.
Other considerations include imputation systems, tax consolidation, and different types of consolidation groups, including administration and multiple entries.
If you live in another country, it might feel as if the Australian government takes all your hard-won income through taxes. But there are ways to reduce your costs, Diverse Accounting Services offer tier-one accounting at an affordable price. But paying for accounting is only the tip of the iceberg.
You also need to pay special heed to your goods and services taxes (GST). They make or break small businesses like yours. They’re imposed by Australia’s federal government at a rate of 10%.
It’s paid by suppliers, like a value-added tax in other countries. And it comes in many forms.
Now that you have a better grasp of small business taxes in Australia, you can see the complexity of the system. Most small business owners can prepare their own taxes but seek out expert help instead. It ensures these businesses don’t miss out on hidden tax breaks.
If you have additional questions speak to Mike from Diverse Accounting Services to discuss your accounting needs.
Are you just starting a small business? Are you looking to advance your business to the next level? Are you lost when it comes to the financial paperwork?
Looking to keep your small business bookkeeping on track? Read on for all the top tips and tricks you need.
1. Keep Your Personal Finances Separate
You should always keep your personal finances completely separate from your business finances. This can prevent confusion and bigger problems down the line.
Pay yourself a complete salary out of your business income, rather than paying for your needs out of the pot. That will keep things simpler and cleaner.
For example, if your business goes bankrupt, you won't be on the hook personally as well. The vice versa is also true.
2. Maintain Meticulous and Accurate Records
It's incredibly important to record every single financial transaction involved in your business. Make sure that these records are completely accurate, and keep them safe and up-to-date. That includes records of deposits, too — you need to make sure you know exactly what's coming in.
Set a specific time and day each month to update your records, and go through them to make sure that they are correct. If you make sure you're staying on top of these things, you won't be struggling in a pile of paperwork when you end up really needing your records.
There are different types of bookkeeping software to help you make sure that you have kept a record of everything you need. Some of them even have automation options, to further streamline the process for your needs.
You'll also need to make sure you're keeping all your receipts. That's especially important when it comes to tax time. If you end up getting audited, and you're missing your financial records, you'll probably have a lot of issues.
3. Prepare for The Future
You should be setting aside money to make sure that you'll be able to invest further in your business in the future. This can also protect you if you run into emergency expenses.
You also need to make sure that you're putting away enough money for when tax season hits. If you end up stuck with a big bill, you want to be prepared. Creating a specific business savings account and putting a set percentage in that account every month is very important for the future of your business.
4. Hire a Professional
Sometimes, it's best to partner with professionals when it comes to your bookkeeping needs. You can outsource some of your bookkeeping needs, such as payroll, to streamline to process and prevent problems.
Some accounting services can also help you improve your use of technology, by setting up cloud-based accounting services and other programs to help improve your bookkeeping processes.
Get help with your bookkeeping!
Diverse Accounting Service specialise in bookkeeping services for small to medium business in almost any industry. Our experienced and qualified accountants can carry out all services concerned with your financial records. We offer a professional and confidential service that won’t break the budget.
Hopefully, these small business bookkeeping tips have gotten you on track to expand your business in no time.
Are you looking for accounting help?
Diverse Accounting Services
7 Officedale Rd
Officer, VIC 3809
0409 367 955