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18 June 2021

End of Financial Year Prep 2021 - Businesses & Employers

End of Financial Year Prep - Businesses & Employers

Equipment

  • If you are thinking of upgrading or purchasing new business-related equipment soon, you can do this before 30 June and include the cost as a deduction on the 2021 tax return
  • Assets purchased after 7.30pm on 6 October 2020 can be deducted in full in the financial year in which they are purchased - there is no limit on the price of the asset for this claim
  • Between 1 July-6 October 2020 assets purchased up to a value of $150,000 (or $165,000 if you are registered for GST) can be deducted in full in the 2021 financial year as part of the instant asset write off scheme

Review accounts

  • Write off any bad debts and unpaid accounts before 30 June
  • Review directors loan accounts and make any adjustments or repayments as needed before 30 June

Prepayments

  • Consider pre-paying for certain expenses such as rent or insurance, to increase your deductions in the 2021 tax return

STP Reporting, finalisation & PAYG Payment Summaries 

  • If you have employees, prepare for STP finalisation or PAYG Payment Summaries by checking details for all staff paid in the current financial are complete and up to date before 30 June
  • We have been in contact with some of you already regarding your employee details - please check these and get back to us with any updates needed as soon as possible
  • If you are not yet set up for Single Touch Payroll (STP) reporting to the ATO, please get in touch so we discuss whether your payroll software is STP compliant & what you need to do to complete the set up 

Superannuation contributions

  • If you have employees, bring your staff super contributions up to date
  • Consider making extra contributions for company directors & proprietors before 30 June within the related contribution caps
  • Directors and proprieters may also be able to take advantage of the carried forward balances from previous financial years if they did not contribute up to the $25,000 contribution threshold in 2019 and 2020 and have a total super balance of less than $500,000

Increase to the Superannuation Guarantee rate

  • From 1 July 2021, the superannuation guarantee rate will increase from 9.5% of gross wages to 10%
  • This will continue to increase by 0.5% each financial year, until it reaches 12% from 1 July 2025
  • This means that the super accrued on employees' gross wages will need to be increased in your payroll software to 10% for all wages paid from 1 July 2021 onwards
Motor Vehicle Logbook
  • Make sure your car logbook is up to date for any business vehicles for the 2021 financial year
  • The ATO is focusing on motor vehicle claims and log book records more each year, so if your log book is out of date (over 5 years old) or if your car use or business situation has changed since you last recorded a logbook, we would recommend updating your records with a current logbook of your business car use for 2021
  • For more information on logbooks please read our article here

Taxable Payments Annual Reporting

  • If you are in the building & construction, cleaning or courier industry you will need to lodge a Taxable Payments Annual Report (TPAR) with the ATO to report your payments to contractors from 1 July 2020 - 30 June 2021
  • Make sure details for all contractors paid in the current financial year are up to date, in particular their ABN, business name and address
Stocktake
  • If you hold stock or record inventory in your business, it's important to conduct a stocktake of inventory as close to 30 June as possible each year
  • Any adjustments to stock figures can then be included in the 2021 tax return to ensure stock reported matches actual inventory held 

 

Liability limited by a scheme approved under Professional Standards Legislation. Liability is limited in those States where a current scheme applies.   

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