Tax prep without the stress, for small business gals ready for change

Tax time is rollin’ around again, I know you hate me for mentioning it. I get it, I mean I truly do. It isn’t only that you don’t understand it all (admittedly, I have always been pretty ok with this part), but that it means you must look at your results, face whether you are doing well, AND to top it all off, let someone else see too. {insert red-faced emoji}

One of my good friends does my tax for me, we used to work in accounting firms together and just like you, I get embarrassed too. I worry that he will look at my numbers and think ‘I told you to come do government consulting with us’ or metaphorically pat me on the head and say ‘yes sweetie, you do a big real business’.

I am not quite where I want to be with my business as yet and if I didn’t know how important the numbers were, I would be hiding under the bed, sitting on top of my finances so no one could see. BUT they are the most important thing to be looking at in your business and so I look at my numbers constantly and I let my friend see them.

 

So here are some things I want you to pop on your list to do between now and the end of August. These are non negotiables- you need to prioritise them, not for me but for you and your future success.

1- Make sure your bank accounts are all reconciled in your Xero file

When you get behind, it is easy to keep putting this one off. The longer you put it off, the worse it is going to get. So, either schedule 30 mins a day to get it done (first thing in the morning – eat that frog!), get yourself accountable by coming to my membership Small Change, Big Impact and doing it together, or just pay someone to get the bulk of it done so it is out of your life, and you can stay on top of it in the future.

2- Make sure you have all your receipts entered in if paid from a personal account

Not sure how to enter these into your Xero file? Start by entering them as bills and then you will need to make a payment from your loan or drawings account. If this is all gobbledygook – get in touch and I can show you how or ask your accountant. It is easy once you know x

3- Upload as many pics of your receipts as possible

This is going to make your accountant’s life so much easier. It also means your tax will be more accurate as your accountant can actually check the treatment of your expenses. AND it means you are covered in case the ATO wants to take a look at the evidence of your claims.

Hot tip – this is a great job to do on the app while watching a binge-worthy tv show like Parks and Recreation. Laughter and bookkeeping all at once – what more could a girl ask for?

4- Look at your profit and loss

This is the report that lets you know how much in sales you have gotten, how much in expenses you have invested and how much is left for you.

This report is the very first step in understanding if your business is financially viable. Now don’t worry if the results aren’t what you want them to be. This is merely an opportunity to improve. BUT you won’t know what you need to do, or how much improvement you need if you don’t get super brave and start looking.

Check it out on a monthly basis and a financial year to date basis. That way you will begin to learn the trends of your business, how they relate to your personal life and what you can do to begin to improve them. If you want someone to hold your hand through this, I promise I do not judge, but I can guide you to start making some tweaks to improve your results.

5- Make a budget/forecast for the coming financial year

What are the different outcomes?

That’s right my friend, you need different inputs. Start by creating a budget or as I like to call it, a roadmap, for your business.

Set out what you are striving to achieve in the coming 12 months; the expenses you will have to invest in, the time you will have to spend working to achieve it, and give yourself a framework to be guided and inspired by.

It allows you to tweak tactics as you go and begin to understand what works and what doesn’t.

6- Get an idea of how much tax you need to pay and check if you have enough savings

I like to know what kind of tax bill might be waiting for me before it is lodgment time, and I am constantly estimating taxes for my clients. Surprises when they come in the form of tax, aren’t the type of surprises anyone wishes for. So, get an idea of your profit, review to see if you have the cash to invest in any tax minimising techniques with your accountant, and then get an estimate of how much you will pay. If you don’t want to do tax planning with your accountant, at least hop on the ATO’s tax calculator on your own.

Then come up with a plan to pay for it.

I know that you can do this. I know you can have the financial outcomes in your business you want, you just need to stick to it, get some help at times and make sure you know your numbers.

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