Starting a small business may be relatively simple but as your operations improve and incomes start to grow, getting your financial records in order for tax purposes can be a daunting task. Reporting assessable income, business expenses and other declarations is essential in lodging tax returns. You can simplify this by using the services of a small business accountant.
A small business accountant is your valuable partner in lodging accurate tax returns and reducing your taxable income within legal limits. He or she can provide a range of accounting services such as:
- data entry;
- petty cash;
- record keeping;
- reconciling bank accounts;
- accounts payable and receivable.
If your accountant is registered as a Business Activity Statement (BAS) agent with the Tax Practitioners Board, he or she can do so much more for your company. A BAS agent is authorised by law to:
- Give you advice about your obligations under a BAS provision;
- prepare and lodge approved forms about a taxpayer’s liabilities, obligations or entitlements under a BAS provision;
- transact with the ATO on your behalf as a taxpayer in relation to your taxpayer’s obligations under a BAS provision.
BAS provision includes the following:
- GST (Goods and Services Tax) law;
- fuel tax law;
- luxury car tax law;
- wine equalisation tax law;
- fringe benefits tax law (relating to collection and recovery only);
- pay as you go (PAYG) withholding;
- PAYG instalments.
Some accounting issues in Tax reporting.
Computation of taxes withheld: As an employer, you are required to withhold PAYG taxes and are assumed to know how to arrive at the correct amount of PAYG.
Reporting income and expenses accurately is a serious matter under tax laws for which you may receive high penalties and surcharges for failing to report and deduct accordingly.
The best time to hire a bookkeeper is when you start operating your new business when it is easiest to install an effective system for recording all transactions. Having a small business accountant at the onset eliminates the headaches of sorting through voluminous records and correcting entries. You get valuable tax advice as well which can legally reduce your taxable income and avoid penalties when your BAS certified accountant lodges your quarterly or annual tax returns on time.
Tags: accurate tax, Business Activity Statement, business structuring, fringe benefits tax, fuel tax law, lodging tax returns, luxury car tax, payroll data, starting a small business, Tax planning, tax practitioners, tax returns Australia, wine equalisation tax