Whether a brand-new startup or a well-established enterprise in Australia, your business needs to fulfill several financial obligations. With so many different aspects of your business to manage, it can be tempting to put financial management on the long finger.
However, as a business owner, it’s crucial that you keep up with your financial reporting requirements so that you avoid incurring penalties or fines.
From payroll to business activity statements, financial year reporting, and calculating GST, you must keep up-to-date with a seemingly never-ending list of financial reporting requirements.
While taking care of all these tasks might initially feel overwhelming, with the right approach, you can be sure that you stay on top of your business finances going forward.
With your business’ financial obligations under control, you can focus on the more important aspects of running your company.
Let’s take a closer look at some of the most important financial obligations your business must adhere to when operating in Australia.
Payroll
Since July 2019, small businesses with twenty employees or fewer must submit payroll reports to the Australian Tax Office (ATO) through Single Touch Payroll (STP) software.
Savvy business owners use modern accounting and payroll software platforms that integrate easily with the ATO system to ensure that accurate payroll reports are submitted on time and with relevant information.
Business Activity Statement
The ATO requires all businesses in Australia to submit a Business Activity Statement (BAS) either on a monthly, quarterly, or annual basis. Some businesses must also submit an annual GST return too if eligible.
BAS reports are used to report and process the payment of goods and services tax (GST), as well as Pay As You Go (PAYG) installments, PAYG withholding tax, and a range of other tax obligations that Australian businesses must comply with.
You will need an Australian Business Number (ABN) and register for GST to set up a business in Australia. When you go through this process, the ATO will assign you a business activity statement to lodge at the appropriate time.
Every business in Australia that is registered for GST will need to lodge a BAS by the assigned deadline.
Income Tax Return
The financial year for tax is from July 1st to June 30th every year. Business owners across the country must ensure that they lodge an income tax return for the financial year period every year.
Sole traders, however, are exempt as they can declare their business earnings as part of their income tax returns.
Required Record Keeping
As a business owner in Australia, you are legally obliged to keep financial records for five years after they have been obtained and prepared or when transactions have been completed. Financial records must be kept in English and prepared in a format easily accessed by the ATO.
Keeping proper financial records will help you monitor your business finances confidently and allow you to make the right decisions for your company going forward.
Be Sure To Meet Your Financial Obligations As Business Owner
Meeting your financial obligations as a business owner will help you to keep track of your business finances, allocate funding to the areas of your business that need it the most, and avoid incurring any fines or penalties.
With the right approach to managing your business finances, you can be sure that your business will be able to meet your obligations to thrive and grow moving forward.
