What small businesses need to know before end of financial year 2021, including about the Federal budget concessions.

June 1, 2021

By Milton Young, First Class Accounts Tullamarine, Franchisee of the Year 2020

Small businesses are winners in the Federal budget thanks to instant asset write-off which allows them to claim deductions upfront, rather than through depreciation.

June is here. While many of the budget changes will start from 1 July 2021, knowing what will change may influence your decisions today about whether to invest now or later.

Here is a short breakdown of the most important things from the budget that could lift your bottom line this end of financial year.

  • There are big concessions coming for certain industries. Keep an eye on businesses in the biotechnology space, microbreweries and distillers, and gaming companies.
  • Apprentices will now be less expensive to employ with a 50 per cent wage subsidy on offer.
  • Small businesses now don’t have to wait years to recoup the tax advantage from an asset investment through depreciation, as are able to instantly write off the cost of the asset.
  • From July 1, 2023, business owners benefit from changes in how to measure depreciation as they then hold the reigns to deciding the tax-effective life of intellectual property assets like patents, registered designs, copyrights and in-house software.
Here are some of the top tips to consider as you prepare your books.
  • Review the amounts for staff and directors superannuation. That needs to be paid by 14th June to be able to claim in this Financial Year.
  • If you are reporting on a cash basis look at forward paying suppliers to reduce your June Tax Bill (BAS/ Income Tax)
  • Review the amount of related party loans and directors drawings.
  • Make sure your log books for motor vehicles are up to date.
  • Review the debtors ledger to write off any bad debts.
  • Review the stock to write off any obsolete items/ lines.
How to do something about this now.

A good bookkeeper and accountant will be up to speed with these things. First Class Accounts have hosted training around EFOY updates for all our bookkeepers.

The best thing you can do is take control and raise it with your bookkeeper and accountant.

You know you’re with a good consultant if they guide you through the implications and opportunities for your business.

Looking for ways get your books in order for end of financial year? Search our nationwide list of bookkeepers to find an expert near you.

Bookkeeping Home Page