END OF FINANCIAL YEAR CHECKLIST
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For most clients, 1 April signals the start of the New Year for business and tax purposes, and the month of March brings opportunities to minimise tax and maximise cash surpluses for the coming year.
A well known quote is “if you fail to plan, you are planning to fail!”, so with this in mind we give you some things to think about going forward. For those of you in business, consider the following points:Year End Tax Planning Checklist
Before 31 March
Bad Debts
Review your debtor’s ledger. In order to claim a deduction for bad debts, the debts you believe will not be collected MUST be written off in your debtors ledger prior to 31 March.
Repairs & Maintenance
You may want to consider undertaking any necessary repairs & maintenance on assets prior to the end of the financial year, but please talk to us to ascertain if a full deduction for taxation is applicable.
Asset Purchases
Consider the purchase of needed low-value assets prior to 31 March. All assets costing under $500 (ex GST) may be claimed as an expense in the year of purchase. Once again, please talk to us to ascertain if a full deduction for taxation is applicable, as there certain rules relating to assets under $500.
Review Last Year's Fixed Asset Register
The book value of assets can be written off for taxation purposes if the asset is no longer in use by the business and the business has no intention of using the assets in the future.
Pre-paying Certain Expenses
Some expenses can be prepaid in March and claimed as a tax deduction in the year to 31 March, regardless of the amount. These include stationery, postage and courier charges, vehicle registration, rates, and subscriptions for papers or journals. Other expenses have limits, including rent, consumables, insurance premiums, travel & accommodation, advertising, periodic charges and other services. The rules surrounding prepayments are complex so if you are planning this type of expenditure, please talk to us.
New Tax Year Planning Checklist
Are you dreading supplying information to us so we can complete your 2015 affairs? If so, why not make a New Tax Year's Resolution to make life simpler in the coming year.
Step 1
If you haven't already, talk to us about a suitable electronic cashbook such as Xero (pricing from $20 per month).
Step 2
Start to develop your regular accounting procedures by separating your tasks by expected frequency: weekly, monthly, two-monthly, tri-yearly, six-monthly or yearly. General accounting chores will fall into each category, and tax-related tasks typically come up no more than monthly.
Weekly & Monthly Tasks
These tasks are bookkeeping chores and each business will differ in complexity depending on transaction volume. Generally all businesses should follow these steps.
• Sort your mail into action piles (such as bills to pay and orders to fill - if applicable).
• Process any new customer orders, record all sales transactions, and mail out any new accounts receivable invoices (if applicable).
• Gather the day's cash and checks, make up a deposit slip, and bank (if applicable) .
• Pay any invoices that are due or for which you can get an early payment discount.
• Record any withdrawal and deposit transactions in the electronic cashbook.
• File records in a suitable filing system
• Reconcile bank statements to electronic cashbook.
Two-Monthly, Tri-Yearly or Six-Monthly Tasks
These tasks are GST, PAYE or income tax related. Once the weekly and monthly tasks are adhered to, the rest will follow in an orderly fashion.
Please contact us for advice on how to start this process now.
Before 31 March
Bad Debts
Review your debtor’s ledger. In order to claim a deduction for bad debts, the debts you believe will not be collected MUST be written off in your debtors ledger prior to 31 March.
Repairs & Maintenance
You may want to consider undertaking any necessary repairs & maintenance on assets prior to the end of the financial year, but please talk to us to ascertain if a full deduction for taxation is applicable.
Asset Purchases
Consider the purchase of needed low-value assets prior to 31 March. All assets costing under $500 (ex GST) may be claimed as an expense in the year of purchase. Once again, please talk to us to ascertain if a full deduction for taxation is applicable, as there certain rules relating to assets under $500.
Review Last Year's Fixed Asset Register
The book value of assets can be written off for taxation purposes if the asset is no longer in use by the business and the business has no intention of using the assets in the future.
Pre-paying Certain Expenses
Some expenses can be prepaid in March and claimed as a tax deduction in the year to 31 March, regardless of the amount. These include stationery, postage and courier charges, vehicle registration, rates, and subscriptions for papers or journals. Other expenses have limits, including rent, consumables, insurance premiums, travel & accommodation, advertising, periodic charges and other services. The rules surrounding prepayments are complex so if you are planning this type of expenditure, please talk to us.
New Tax Year Planning Checklist
Are you dreading supplying information to us so we can complete your 2015 affairs? If so, why not make a New Tax Year's Resolution to make life simpler in the coming year.
Step 1
If you haven't already, talk to us about a suitable electronic cashbook such as Xero (pricing from $20 per month).
Step 2
Start to develop your regular accounting procedures by separating your tasks by expected frequency: weekly, monthly, two-monthly, tri-yearly, six-monthly or yearly. General accounting chores will fall into each category, and tax-related tasks typically come up no more than monthly.
Weekly & Monthly Tasks
These tasks are bookkeeping chores and each business will differ in complexity depending on transaction volume. Generally all businesses should follow these steps.
• Sort your mail into action piles (such as bills to pay and orders to fill - if applicable).
• Process any new customer orders, record all sales transactions, and mail out any new accounts receivable invoices (if applicable).
• Gather the day's cash and checks, make up a deposit slip, and bank (if applicable) .
• Pay any invoices that are due or for which you can get an early payment discount.
• Record any withdrawal and deposit transactions in the electronic cashbook.
• File records in a suitable filing system
• Reconcile bank statements to electronic cashbook.
Two-Monthly, Tri-Yearly or Six-Monthly Tasks
These tasks are GST, PAYE or income tax related. Once the weekly and monthly tasks are adhered to, the rest will follow in an orderly fashion.
Please contact us for advice on how to start this process now.
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Testimonials
Hi Salesh, I just wanted to send you an email on behalf of GRA to say how fantastic we have found your company to date. As you know, Ben and I joined GRA a couple of months ago and have just found you so amazingly helpful in getting our new property set up correctly and sorted out. We have what I would consider a rather complicated structure as a result and it’s a fantastic feeling to know that we are getting everything done in the best way possible. We have just had approval to put a minor dwelling on the property which will make a massive difference in terms of cash flow and obviously value, something we would never have even thought of without GRA and which we are very excited about. During the buying process we attended a seminar with Matthew and from the outset thought he was fab. We therein signed up for property school and found this nothing short of fantastic. The content was relevant, up to date and comprehensive, but more importantly it was taught in a way that we could actually understand and really get value out of. I wanted to mention also, that everybody GRA have recommended to us has been just so efficient and absolute masters at what they do. A wonderful network of people that we feel very lucky to now be able to call on. From Kris Pederson and Bryan Rist who put our mortgage together to the insurance guys they then referred us to, I’m super impressed. Within GRA, Ellery has probably turned things around for us faster than I’ve ever known before, something which we appreciated so very much when it came to crunch time. She’s always a pleasure to deal with and again, we’re stoked. We’ve just settled on the property today and are about to go and get the keys. I’m pretty pumped and hence this email is probably rather excitable. So, a massive thank you to you Salesh, the partners for such a fabulous 6 weeks at property school and everyone at GRA for their help. May this be the start of our property empire. Thanks again, - A & B - July 2015
Gilligan Rowe and Associates is a chartered accounting firm specialising in property, asset planning, legal structures, taxation and compliance.
We help new, small and medium property investors become long-term successful investors through our education programmes and property portfolio planning advice. With our deep knowledge and experience, we have assisted hundreds of clients build wealth through property investment.
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