What to do before the End of Financial Year
The end of financial year is almost here! There are many things that you as a business owner has to consider, and it is important to be aware of these issues and get everything in order before 30 June.
Take care of any ATO debt you have as soon as possible. Many businesses accrue tax debt by failing to pay their business activity statement (BAS) on time, or through mismanagement of financial obligations such as PAYG or withholding superannuation contributions, keep this in mind for your business. If you can’t afford to pay in full, negotiate a repayment plan with the ATO – see us if you have any problems here.
In most states it is compulsory to lodge a payroll tax reconciliation at the end of financial year. The annual threshold in NSW for the period 1 July 2013 to 30 June 2014 is $750,000, you are liable to pay payroll tax on the amount by which this is exceeded. This total amount includes any wages, remuneration, salary, commissions, bonuses, allowances paid or payable, superannuation and certain contractor payments.
All NSW employers must have a workers compensation policy if they pay more than $7,500 in wages each year, employ an apprentice or trainee, or are part of a group for insurance premium purposes. You need to make sure that you have the correct coverage for your employees. Remember that the premiums paid are tax deductable. Remember that payments to directors qualify as wages.
All of your superannuation contributions must be paid before 30 June in order to be claimed as a deduction this tax year.
Shareholders Loan Accounts
You need to review your shareholders loan accounts to ensure they are not in debit – meaning that the shareholder owes the company money. If this is the case the Div 7A tax may apply. Make sure they are in credit meaning that the company owes the shareholder money.
All trusties who make beneficiaries entitled to trust income by way of a resolution must do so by the end of an income year – 30 June. This resolution will determine who is to be assessed on the trust’s taxable income.
As a business owner, you will have many things to organise before 30 June 2014. Make sure that you have addressed each of these issues before that time, to minimise stress and the chance of making mistakes. Here at The Quinn Group, our experienced team, of accountants and tax agents can assist you with all of your taxation needs. For more information submit an online enquiry or call us on 1300 784 667 to book an appointment.