FINANCIAL CONNECTION
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The biggest mistake I see is people not keeping records... of expenses for their vehicle and its depreciation.
What’ s hot this tax year
If your business requires new equipment, machinery, computers or mobiles, Vasin says now is the time to buy them. He notes that the instant asset write-off for small businesses or sole traders will be slashed from $ 150,000 in this tax year to $ 1,000 from 1 July 2023. But to enjoy the deduction, the asset must be installed and ready for use by 30 June 2023. The same applies to motor vehicles, but Vasin says you can only claim a deduction for $ 64,761 or less.
“ If you are self-employed, don’ t forget to make a before-tax concessional contribution to your super to claim another deduction,” he adds.
This payment cannot be higher than $ 27,500 for the financial year and according to Vasin, it should not be made right at the end of the financial year because it can take a few days to appear in your super account and may count as a contribution for the following financial year. Certain rules may apply.
Getting better at record keeping
You may keep your records in a shoe box or an elaborate filing system, but there’ s plenty you can do to improve your record keeping. As a first step, you will need to know what records you need to keep.
“ The biggest mistake I see is people not keeping records to take advantage of
JOSHUA MORRIS expenses for their vehicle and its depreciation,” says Vasin.
Records for expenses must directly relate to spending related to earning your income. You should also keep proof of the income you receive from things like salary, wages, allowances, capital gains, dividends, government payments or pensions.
You don’ t have to obtain receipts for expenses that are $ 10 or less, as long as your total claim for small expenses is $ 300 or less. If you can’ t get a receipt, you can use another form of evidence, such as a bank or credit card statement, to prove you spent the money.
When it comes to record keeping, the ATO says you should be able to show it your records if it asks for them, keep your records for five years and ensure your records are in English or easily converted to English.
Zilla Efrat is an experienced business and finance reporter. She is based in Sydney.
3 TAX TIME APPS
For safekeeping, Vasin advises using one of the apps available that lets you scan and store receipts on your phone or computer.
1. TINY SCANNER is an app that turns an android device into a portable document scanner and scans everything as images or PDFs.
2. THE ATO APP is a simple and easy way to access and manage your tax and super on the go. It’ s free to download and use.
3. SQUIRREL STREET can scan and store receipts, but it can also organise invoices and documents securely in the cloud.
COSTCO CONNECTION
Find items to support your business in warehouses and on Costco. com. au.
THE INFORMATION IN THIS ARTICLE IS GENERAL ONLY AND NOT A SUBSTITUTE FOR PROFESSIONAL FINANCIAL SERVICES.
16 | MAY / JUN 2023 COSTCO CONNECTION