2020 has been the year of uncertainty, and nothing scares people more than not knowing and not having control over what's going to happen in their lives in the next months.
During the pandemic, many people were forced to change the way they live. Businesses have started to shift their operations online. Some were laid off, while others try to make ends meet by starting small online businesses. Whatever the case, if you're a business owner, you'll still have to deal with audits, even in the middle of a pandemic.
To help business owners deal with their taxes and audits, one of the things that they do is hire an accountant for an eCommerce business to help keep their finances in check during these unprecedented times.
If you're dreading to deal with your audits this 2020, don't panic; we've got you covered. In this article, we'll discuss everything you need to know about audits and how to make your Australian Tax Office (ATO) run smoothly. Let's dive in!
Quick backstory on audits and modern accounting
When people think of an audit from the ATO, many people start to feel anxious about the legal work they have to deal with. Undeniably, for some people, it is one of the most stressful things business owners have to deal with, especially if their business is under scrutiny and have missed some details on their taxes.
Fortunately, over the years, accounting firms have started to integrate automated accounting in their operations to help clients deal with their taxes and to do most of the heavy lifting during tax season. Once they've set up the system, GST, PAYG and other BAS requirements are automatically calculated to help prepare your monthly, quarterly, and yearly BAS.
Once you have all the information, you can give this data to your eCommerce accountant, they'll go through your system and they can quickly finalise your information before submitting it to the ATO.
Fortunately, there have been more developments in how agents can handle business accounting issues. As long as your business is above board and follows modern practices, you shouldn't have any concerns.
All you need to do is make sure you have all your financial records, receipts and paperwork ready for record-keeping. When you have good bookkeeping, you'll reduce your issues and won't have to worry about audits again.
How to have a smooth, hassle-free ATO review
1. Make sure everything is balanced in your books
Thankfully, with accessible and easy-to-use accounting software available, it's much easier to ensure that all your records are balanced in your books.
2. Be a responsible business owner
When you do something sneaky or dodgy, you'll most likely get caught. If you're earning money and if there's regular financial movement in your business, report it. However, if it's non-business related, you don't need to claim it.
3. Report all income and keep records safe
When you do "under-the-table" work and transactions, you're most likely to make mistakes and have issues in your taxes and audits. The best way to deal with this is to not risk anything and report all of your financial movements and transactions.
Besides that, make sure that you have all your receipts and paperwork ready, just in case ATO requests to view this information. Also, having an organised way of keeping records will give your accountant a much easier time dealing with your taxes and audits.
Conclusion
2020 was a scary year for many people, especially in the financial area of their lives. However, now that you know how to deal with your audits this year, it shouldn't be scary and challenging at all. You just need to be a responsible business owner, keep all of your financial records and work with a reliable eCommerce accountant to help you with all your business's financial paperwork.
If you're looking for accountants for online business, The eCommerce Accountant is here for you. We offer accounting services and provide business advisors for online businesses and influencers in Australia. Connect with us and give us a call today!