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FY 2017 Year End Tax Tips for Businesses

FY 2017 Year End Tax Tips for Businesses

With just 6 days to the end of the financial year, here are some tax tips for businesses.

Trust Resolutions

If you run your business in a trust structure, be aware that trustees are required to make trust resolutions before 30 June in relation to how trust income will be distributed among beneficiaries.

Write off Bad Debts

To obtain a bad debt reduction, a debt must not be merely doubtful and must be written off as bad during the year of income in which the deduction is claimed. The debt must have been previously included as assessable income.

For businesses who pay GST on an accruals basis, you will also be able to claim back a GST credit. If you have paid GST on a sale but did not end up receiving any payment for that sale then you are able to adjust your Business Activity Statement (BAS) accordingly.

Write-off Inventory

EOFY is a good time to conduct a stocktake to identify missing, slow moving, damaged and obsolete stock, which must be written off prior to 30 June to claim a tax deduction.

Review PAYG Income Tax Instalments

Small businesses should review their PAYG income tax instalments and notify the ATO if expected profit will be higher or lower than previous financial years.

Take Advantage of Small Business Concessions

If your business is a small business entity (SBE), you can access a number of SBE concessions. Your business is a small business entity if you are a sole trader, partnership, company or trust that:

  • operates a business for all or part of the income year, and
  • has an aggregated turnover less than $10 million (the turnover threshold).

Instant Asset Write-Off

If you are a small business, you can immediately deduct the business portion of most assets that cost less than $20,000 each if they were purchased from 1 July 2016 to 30 June 2017. This deduction can be used for each asset that costs less than $20,000, whether new or second-hand. You claim the deduction through your tax return, in the year the asset was first used or installed ready for use.

Instant Write-Off of Start-Up Costs

small businesses are entitled to certain deductions when starting up a small business. The range of deductible start-up costs includes professional, legal and accounting advice and government fees and charges.

Small Business Restructure Rollover

Small businesses can change the legal structure of their business without incurring any income tax liability when active assets are transferred by one entity to another. This rollover applies to active assets that are CGT assets, trading stock, revenue assets and depreciating assets used, or held ready for use, in the course of carrying on a business.

Ensure your books are kept in order and up-to-date

Most importantly, ensure your books are kept in order and up-to-date. Timely recording of transactions results in real-time financial information being available to your accountant, who can then make accurate forecasts and provide useful tax planning advice well before the end of the financial year. Help your accountant to be your best business advisor by ensuring that the books are up to date, and all receipts have been provided.


Need assistance with bookkeeping, budgeting, forecasting, business strategy or tax planning? Contact us for a coffee chat to see how we can help.