The new financial year is officially underway. Now that we have passed the 30th of June, many Australian business owners are eager to get their tax returns lodged and find out what their financial position looks like. However, rushing straight to your accountant with a messy shoe box of receipts or an unreconciled software file is a costly mistake. Before you even book that meeting with your tax professional, you need to ensure your bookkeeping is completely sorted.
Accountants and bookkeepers play different, yet complementary, roles in your business. Your bookkeeper is responsible for the day-to-day financial data entry, reconciling accounts, managing payroll, and ensuring that your baseline numbers are completely accurate. Your accountant takes that pristine data to prepare tax returns, offer high-level tax planning, and provide strategic business advice. If you hand your accountant disorganised data, they will have to spend hours doing bookkeeping work at an accountant’s hourly rate.
As we sit here in early July, there are several common end-of-financial-year mistakes that a good bookkeeper can help you avoid. If these are not resolved now, they will cause major headaches during your tax appointments.
To ensure a smooth handover, your bookkeeper should handle a few specific tasks:
- Reconciling all bank accounts up to the 30th of June
- Managing your end of year payroll processes
- Calculating multi-state tax obligations
The Single Touch Payroll timing trap
One of the most frequent errors we see involves the final pay run of the financial year. Single Touch Payroll relies on the exact date the money hits your employees’ bank accounts, not the date the pay period ends. If you processed a pay run for the period ending on the 30th of June, but you did not actually transfer the funds until the 1st of July, that payment belongs in the new financial year.
Failing to recognise this will break your Single Touch Payroll finalisation. Your bookkeeper needs to ensure that the payment dates align perfectly with your bank feeds. If they do not, your employees will have incorrect income statements in their myGov accounts, which delays their personal tax returns and puts your business on the wrong side of Australian Taxation Office rules.
July payroll tax obligations
Another major hurdle this month is payroll tax. For businesses that meet the payroll threshold, annual payroll tax reconciliations and payments are due in July. A bookkeeper will ensure that your total taxable wages for the year are calculated correctly, taking into account superannuation, fringe benefits, and contractor payments where applicable. Handing this to your accountant at the last minute could result in missed deadlines and hefty penalties.
Managing a multi-state workforce
The rise of remote work has fundamentally changed how Australian businesses operate, but it has also complicated payroll tax. If you have hired employees who work in different states, your payroll tax obligations are not limited to the state where your business is headquartered.
You are required to register, submit, and pay payroll tax to the specific revenue office in the state where each employee actually works, provided your total Australian wages exceed the relevant state thresholds. For example, if your head office is in Victoria but you have staff working from home in Queensland and New South Wales, you need to be dealing with the State Revenue Office in Victoria, Revenue NSW, and the Queensland Revenue Office. A skilled bookkeeper will map out your interstate wages and ensure your compliance across every jurisdiction.
If you want to ensure your books are perfectly balanced and accountant-ready this July, get in touch. The team at Nova Business Services is ready to get your finances sorted so you can start the new financial year with total confidence.
Our team is here to support you and your business in many different ways, give us a call on 1800 668 225 or reply to this blog by clicking here to ask us any questions.
