If your online business managed to survive the pandemic, then congratulations! You live to serve customers another day. But that doesn’t mean your finances can’t be in order. Since you’re in the green, you’re going to need an accountant for online businesses to ensure you still follow compliance and keep working.
Here are some tips to maximise your year-end accounting so your online business stays afloat!
Tip 1: Secure the Necessary Paperwork
Documents you need to have at the ready for filing taxes include:
Activity statements
Employee super contributions
GST returns
Business activity statements
Invoices and receipts to customers
If you’re new to all this and don’t know where to start, tip one should do the trick. We also recommend consulting an accountant for online businesses to make sure you’re up to speed.
Tip 2: Pay Super Owing on or before the Due Date
If you have additional superannuation for your employees, pay them on or before June 30. These amounts are not tax-deductible until paid, so complete this next before moving forward.
It’s important to remember that superannuations reduce your income tax bill, so giving your staff additional value in their benefits certainly pays off, or at least reduces what you have to repay the government.
Tip 3: Secure Your Tax-Deductibles
There are deductibles to consider when computing for tax, like employee superannuation, charity donations, and prepaid services for office supplies, event vendors, and even an accountant for online business fees.
The caveat in these scenarios is that they need to be paid 12 months or less before they are considered tax-deductible. As with tip one, receipts and other financial records are necessary here, as they show proof of their prior arrangement and exclusion from tax. And in light of tip two, these further reduce your taxable income for the fiscal year.
Tip 4: Bear in Mind Pandemic Relief
The economic effects of COVID-19 have inspired the government to enact flexible initiatives such as the JobKeeper Payment plan to affect your tax payments positively. Always check the ATO’s pandemic page for updated info.
Alternatively, you can also consult with an accountant for online businesses to determine just exactly how these relief initiatives impact your overall standing.
Tip 5: Pay on Time
This is the most basic but often ignored step. Gathering all your documents, computing the exact amounts, and consulting with experts are useless if you don’t pay tax on time.
The Australian Taxation Office (ATO) doles out massive penalties for late payments. Concerning SMEs, the ATO charges one penalty unit per overdue day. This ranges from $110 to $222!
If you incur enough penalty units, you’ll have to pay the total balance or, worse, imprisonment! Avoid this by not going alone and hiring an accountant for online businesses to keep you on track.
Tip 6: Consider Online Services
A great way to meet tax deadlines punctually is by handling them online! Virtual computing helps you separate your personal and business records to focus on the latter without confusing a purchase on either one.
We’d also highly recommend creating a separate bank account for your company’s financials as well. That way, you have one dedicated for all your business transactions, making your computations more accurate, effective, and efficient for you and your team. Even with taxes, you should never mix business with pleasure.
One Last Thing
As mentioned several times, handling business finances for the first time may come as a shock since everything is new and unknown. That’s why, apart from checking out government updates, we repeatedly encouraged you to seek out the expertise of an external accountant. They can manage your costs since you can pre-pay them for services while still getting professional advice on your finances. Do consider that for future reference.
If you’d like to work with an accountant for online businesses straightaway, contact The ECommerce Accountant right now! We’re a group of financial advisors specialising in online stores and influencers so they can do what they do best while we handle the rest. Chat with us on our website. We’ll be happy to answer any questions you have.