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When you’re a sole proprietor or run a medium-sized company, there are some costs that you can’t avoid if you want to st

When youu2019re a sole proprietor or run a medium-sized company, there are some costs that you canu2019t avoid if you want to stay in business. One of these is financial record keeping for ATO in 2023. Unfortunately, some people find it challenging and tiresome to finish this necessary task. Think of it as one of those pills you have to swallow regardless of how bad they taste.<br>

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When you’re a sole proprietor or run a medium-sized company, there are some costs that you can’t avoid if you want to st

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  1. Whenyou’reasoleproprietororrunamedium-sizedcompany,therearesomecoststhatyoucan’tavoidifyouwanttostayinbusiness.OneoftheseisfinancialrecordkeepingforATOin2023.Unfortunately,somepeoplefinditchallengingandtiresometofinishthisnecessarytask.Thinkofitasoneofthosepillsyouhavetoswallowregardlessofhowbadtheytaste.Inthisarticle,wewillbediscussingeverythingyouneedtoknowtokeeprecordspertheATO.Whenyou’reasoleproprietororrunamedium-sizedcompany,therearesomecoststhatyoucan’tavoidifyouwanttostayinbusiness.OneoftheseisfinancialrecordkeepingforATOin2023.Unfortunately,somepeoplefinditchallengingandtiresometofinishthisnecessarytask.Thinkofitasoneofthosepillsyouhavetoswallowregardlessofhowbadtheytaste.Inthisarticle,wewillbediscussingeverythingyouneedtoknowtokeeprecordspertheATO. TheImportanceofKeepingRecords

  2. Maintainingaccuraterecordsiscriticalforanysuccessfulenterprise.It’salsoasmartmovefinancially.Thebenefitsoffinancialrecordkeepingareasfollows:Maintainingaccuraterecordsiscriticalforanysuccessfulenterprise.It’salsoasmartmovefinancially.Thebenefitsoffinancialrecordkeepingareasfollows: • Keeprecordsonhowthingsareprogressing • Maintainarecordofyourfinancialtransactions. • HelpuseyourregisteredtaxorBASagenttoyouradvantagetodemonstrateyourbusiness’sviabilitytopotentiallenders. • WhatAreTheRecordsYouMust Keep • ThisisoneoftherecordkeepingFAQsinAustralia.Whenopening,operating,selling,modifying,orclosingabusiness,youmustkeeprecordsofthefollowingfortaxandsuperannuationpurposes: • Receipts,invoices,andotherfinancialrecords • Anyrecordsdetailingthebasisandmethodologyforanyestimate,determination,orcomputationmadeinconnectionwiththetaxandsuper • obligationsofyourbusiness. • Alldocumentsontaxreturns,activitystatements,fringebenefitstax(FBT)returns,andemployeesupercontributionsalldocumentsaboutthepurchase,incometax,sale,andothercostsofanybusinessassets,suchasland,buildings,orofficeequipmentalldocumentsaboutthepurchase,sale,andothercostsofanybusinessassets.

  3. Accurateandfullrecord-keepingpracticesshouldbeingrainedinyoureverydayoperationsforyourcompanytobothcomplywithlegalobligationsandpreventcostlymistakes.Thetypesofdocumentsyouneedtoretainmayshiftasyourcompanydevelopsandexpands.Accurateandfullrecord-keepingpracticesshouldbeingrainedinyoureverydayoperationsforyourcompanytobothcomplywithlegalobligationsandpreventcostlymistakes.Thetypesofdocumentsyouneedtoretainmayshiftasyourcompanydevelopsandexpands. Yourcompany’sdocumentsshouldbekeptfornolessthanfiveyears.KeepingrecordscanbesimplifiedwiththehelpofATOonlinereportingtools.Ifyourcompanydoesn’tretainthenecessaryrecords,itcouldfacefinesandotherpenaltiesfromthelaw. Readalso:AustraliaTaxRefunds:HowtoGetTheBestofIt? Usefullink:AustralianTaxReturnIn2023– EverythingYouNeedToKnow FiveRulesforRecord-keeping Mostoftherecordsyourcompanyneedstopreservetofulfilitstax,superandemployerdutiesfallunderthesefivecategories.AccordingtothelegislationandtheATO,theseare: Youmustmaintainalldocumentationpertinenttoyourtaxandretirementplanningthroughoutthelifeofyourorganisation.Makesureyouhaveconcreteproofofthebusiness-relatedportionofanyexpensesthatoverlapwithpersonaluse. Yourrecordsmustbekeptinafashionthatpreventsthenecessary informationfrombeingaltered(forexample,throughtheuseofelectronicsalessuppressiontechniques)andtherecorditselffrombeingdamaged.ATOrequirementsincludeevidencethatyou’vetakenreasonableprecautions.Ifyoursystemofrecord-keepingevolvesthroughtime,youmustbeabletoreturntotheoriginaldata. Mostdocumentsshouldbekeptforfiveyears.Thefive-yearperiodforretainingeachrecordbeginsonthelaterofthedatetherecordwascreatedorobtained,orthedatethetransactionsoractstheypertaintowere

  4. finalised.However,thebeginningofthefive-yearretentionperiodisdifferentinspecificcasesaccordingtotherecordkeepinglegislationinAustralia.Areviewperiodforanassessmentthatreliesontheinformationinarecordmaynecessitatekeepingtherecordforlongerthanfiveyears.finalised.However,thebeginningofthefive-yearretentionperiodisdifferentinspecificcasesaccordingtotherecordkeepinglegislationinAustralia.Areviewperiodforanassessmentthatreliesontheinformationinarecordmaynecessitatekeepingtherecordforlongerthanfiveyears. Iftheyrequestproofofsomething,youshouldhaveitavailable.Keepdocumentationofyourrecord-keepingproceduresotheycanverifythatitconformstotheregulations.Checkthateverythingyouneedtofulfilyour tax,superandemployerresponsibilitiesisincludedinthedocumentation.Ifyouencryptyourdigitalfilesanddocuments,youshouldbepreparedtosharetheencryptionkeysandinstructionsfordecryptingthem.Youshouldalsocheckthatyourdatacanbeeasilyextractedandconvertedtoacommondataformat(likeExcelorCSV).Providedetailsonhowtoaccessfilesthatarepassword-protected.Besuretolabelorindexyourdataasyoustoreitsothatitmaybeeasilyretrievedafterwards.Theymayneedtoextractittoexamineitwithanindexingortext-searchsystem. AlldocumentationmustbeeitherwritteninEnglishorbeeasilytranslatedintothelanguage. Tipstoavoidrecordkeeping problems Ifyouknowyourfinancialrecord-keepingrequirementsandfollowtheseguidelines,youshouldbefine.TheyarebasedonthemosttypicaltypesofpaperworkmistakestheATOencounters:

  5. Alwaysremembertocarefullydocumentanymonetaryanddigitalexchanges.Alwaysremembertocarefullydocumentanymonetaryanddigitalexchanges. • CashandEFTPOSsalesmustbefrequentlyreconciledandthecorrespondingamountsenteredintothemainaccountingsoftwaresystemforthebusinesstoensureaccuracy.Itmightbeonadaily,weekly,ormonthlybasis,dependingonthenatureofyourcompany. • Ifthenumbersdon’taddup,lookformistakes. • Thebusinesselementofanyitemthatservesdualpurposesmustbecalculatedandrecordedcorrectly. • Remembertoaccountfortradingstockasifitweresoldandincludethevalueinyourbusiness’sassessableincomeifyouhaveusedtradingstock • forpersonaluse.Thiswillensurethatyourcostofsalesstatisticsareaccurate. • Alwayskeepadequatedocumentstobackupanycompanydeductionsyoucouldbeclaimingonyourtaxes. • WhenfillingoutyourtaxformsorBAS,don’tmakeanyguesses.Youmusthavefullandaccuraterecordstobackupanyclaimsyoumake. • IfyourcompanyqualifiesforataxcreditforR&Dinvestments,youshouldutilisethosedocumentsaccuratelytodeterminehowmuchyoucanclaim. • Mostrecordshavearetentionperiodof5yearsfromthelaterofwhentheywerecreatedoracquired,orthedateonwhichtheunderlyingtransactionorrelatedactivitieswerefinalised.Forinstance,ifyourcompanyeverpurchasesapieceofproperty,youmustmaintainallrelevantpaperworkforatleastfiveyearsafterreceivingthetitle.Therecordneedstobekeptforatleast7yearsifyouintendtobuildanewpropertyontheland,whichmighttakeanother2years. • Keeprecordsatleastasfarbackastheconclusionofthereviewperiod.

  6. For5yearsoruntiltheendoftheperiodofreviewfortheincomeyearwhenthelossisfullydeducted,whichevercomesfirst,keeprecordsrelatedtohowyoudeterminedandworkedoutthelossifyourbusinessincursataxlossoracapitallossthatcanbeoffsetagainstcapitalgains.For5yearsoruntiltheendoftheperiodofreviewfortheincomeyearwhenthelossisfullydeducted,whichevercomesfirst,keeprecordsrelatedtohowyoudeterminedandworkedoutthelossifyourbusinessincursataxlossoracapitallossthatcanbeoffsetagainstcapitalgains. • Conclusion • KeepingrecordsisveryimportanttostayoutoftroublewiththeATO.AllorganisationsmustfollowtheATObusinessrecord-keepingrulesandregulationsconsistently.AsmuchastherecordsaregoodforyoursubmissiontotheATO,theywillhelpyourbusinesstobeup-to-dateandaccurateforgrowthanddevelopment.Weunderstandit’snotaneasytasktokeeprecordsdailyforyears,that’swhyTheKalculatorsisheretohelp.WehelpbusinesseskeepallnecessarybusinessrecordsandensureallourclientsareinsafehandswithATO.Toavoidpayingunnecessaryfinesandfees,youcancontactustosimplifyyourrecord-keepingandgeneralbusinessneeds. • Talkwithourexpertaccountantsforfurtherqueries,pleasegiveusacallon0874802593orsendusanemailoninfo@thekalculators.com.au ← AustraliaTaxRefunds: Howto GetTheBest ofIt?→End OfFinancial Year 2023– WhatarethekeyChanges?

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